May 25, 2022

Credit Card Q&A With Our Experts - Eric Bank

Eric Bank
Former Citadel Director of Business Analysis

Life is full of important events. Marriage, childbirth, your first trip to Disney World. I’d like to concentrate on another memorable occasion, applying for your first credit card. Here are five questions you might ask yourself regarding credit card applications and my take on their significance.

1. When did you first get your credit card?

Many folks get their first credit card in college. Student credit cards are one of the best deals in the industry, offering superior benefits and rewards to young people who may not have any previous credit history. Some even offer cash bonuses for academic achievement. If you’re about to begin your college career, take the time to review the different credit cards marketed exclusively to students.

For others, many credit cards are available to credit newbies. Secured credit cards are an excellent way to start. You can get one by depositing as little as $200. By paying your bills on time, you can quickly graduate to an unsecured card.

2. When do you think someone is ready for a credit card?

If you’re eligible to join the armed services or attend college, you’re ready for a credit card. Creating a solid credit history and good credit at an early age gives you a head start on your financial journey and helps you obtain the things that matter to you. 

3. What kind of advice would you give to someone signing up for their first credit card?

Prepare a budget and stick to it. A credit card can be viewed as a tool or a weapon, depending on how you use it. It’s all too easy to charge purchases on your credit card, leading to unplanned spending. Remember, you control the card, not the other way around.

4. What kind of obstacles can one expect when signing up for a credit card? How should one prepare for it?

The card issuers want some assurance that you can afford your monthly credit card payments. Accordingly, they will ask questions about your income and housing costs when you apply. Prepare the information before applying, and be ready to document it with pay stubs, bank statements, rent/mortgage bills, and even tax returns.

5. If one keeps getting rejected, why might that be the case? Do you have any tips?

When a credit card company rejects your application, it must send you an Adverse Action Notice explaining why. Treat the notice as a gift, telling you what to fix before applying again.

Multiple rejections indicate that you may be applying for credit cards with lofty credit standards. If you don’t have a credit history, you’re unlikely to meet those standards. Instead, look for credit cards geared explicitly to consumers with no credit. As mentioned earlier, secured credit cards can be a perfect first step because your refundable cash deposit acts as collateral.

Another alternative is to open a credit-builder account at a credit union. It’s a way to establish credit by repaying a loan held in escrow. 

Keep trying, and you’ll get your first credit card before too long. Just remember to pay your bill on time and keep your unpaid balances low. That’s the golden ticket to an excellent credit score and a more comfortable lifestyle.

Want a card that adjusts your credit limit, lowers your interest rate and increases your cashback rewards based on your good habits each month? Jupiter Card – the first credit card that ensures you get the best deal possible, forever – is a powerful tool for you to take charge of your financial future.
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