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How to Build Credit with a Credit Card
1 Aug 2019

Steady Climb: How to Build Credit with a Credit Card

Your credit score is your golden ticket to the world.

This innocuous little number can control everything from whether or not you can by a house to how much you pay in car insurance each month.

But, if you’re new to the adult world, then there’s a good chance you haven’t accrued any credit and don’t have one of these all-important credit-scores yet.

If that’s the situation, don’t panic. Building credit can be a piece of cake, especially with the help of a credit card.

Ready to start building credit but aren’t sure where to start? We’ve got you covered.

Here’s everything you need to know about how to build credit with a credit card.

Start with the Right Card

If you’re going to do a job the right way the first time around, it pays to have the proper tools in your corner. And, when it comes to building credit, that means having the right card in your wallet.

There are dozens upon dozens of credit cards out there. Some have astronomical limits, and others offer exclusive rewards. So, it makes sense that with all of those cards out there, it can be hard to find the best one for your situation.

If you’re new to the world of credit cards, the best course of action is to start by applying for a starter or secured card.

A starter credit card generally comes with a low limit — think $250-$500 range — is easy to apply for, and a pretty decent interest rate. These types of cards are perfect for those who want to start building credit and don’t generally rely on credit cards for day-to-day purchases.

Pretend You’re Paying with Cash

Once you start using a credit card, it can be easy to go a little overboard and rack up a lot of debt. This type of situation generally occurs because paying with a credit card means you don’t have to have that money in pocket at that moment.

To avoid falling into this type of situation and build up a good, healthy credit score, you should always treat your credit card like a debit card.

If you don’t have enough cash in your account to cover whatever it is you’re paying for, then you shouldn’t buy it with a credit card.

Always Pay Your Statement

When it comes to paying off your credit card, the jury is still out on how much you should put into it. While some experts say you should pay off the entire thing every month, others say you should leave 30% of what you owe.

All that aside, a good rule of thumb is to pay off your new balance on time, every month.

While you can pay your minimum in a pinch, paying your statement will ensure that you’re putting enough in to start raising your credit score.

No matter how much you wind up paying, your goal should always be to remain consistent in your payments. That’s the best way to start building credit.

How to Build Credit with a Credit Card

Building credit is an essential part of ensuring your future financial success. And, with these tips, you’ll be able to rack up a reputable credit score in no time.

Now that you know how to build credit with a credit card, it’s time to find the right card for you.

Need a little help sifting through all of the different credit cards available today? We’ve got you covered.

Check out our review of the best credit cards of 2019 to get started.