Whether or not credit cards will be useful tools for you largely depends on your lifestyle and financial habits. Credit cards can be helpful for people who regularly use them for purchases and pay off the balance in full every month. This builds a solid credit history, which is important not only for approval for better cards, but also for other life expenses like renting an apartment or getting a car loan. Credit cards also provide some fraud protection, meaning cardholders are usually not liable for unauthorized charges made to their accounts.

Pros and Cons of Credit Cards

Pros of Credit Cards

• Opportunity to build credit: Using a credit card responsibly, by making on-time payments and avoiding high balances, can help you establish and improve your credit history. This can help you get approved for other forms of credit, like a mortgage, down the road.
• Rewards and cash back: Many credit cards offer rewards programs that allow you to earn points, cash back or miles for every dollar you spend. These rewards may be redeemed for things like statement credits, travel, gift cards and more.
• Fraud and theft protections: Most credit cards come with zero liability protection. So if your card is lost or stolen, you won’t be on the hook for any unauthorized purchases.
• 0% intro APR offers: Certain credit cards offer a 0% introductory APR period during which you can make purchases or transfer balances without accruing interest. These 0% intro APR offers, which may last for 15 months or longer, may be ideal for financing a large purchase interest-free.
• Travel perks: Frequent travelers will appreciate that some credit cards provide travel-related benefits and protections such as trip insurance, rental car insurance, airport lounge access and the ability to transfer rewards points to hotel and airline partners.

Cons of Credit Cards

• High standard interest rates: Outside of 0% APR promotional periods, credit cards are considered a high-interest form of debt. Standard APRs generally range from the mid-teens to high twenties. You can avoid interest charges by paying off your balance in full each month.
• Other fees may apply: In addition to interest charges, credit cards may come with other fees, such as annual fees, late payment fees, foreign transaction fees and balance transfer fees. These fees can add up quickly and eat into any rewards you may earn.
• Risk of overspending: Credit cards can make it easy to spend beyond your budget as you don’t need to have cash on hand to make a purchase. If a high credit card balance becomes difficult to pay off in full, this can lead to carrying a balance and accruing interest if you’re not within an introductory 0% interest period.
• Approval requirements: Some credit cards may have strict approval requirements, such as a minimum credit score or income level. This can make it difficult to qualify for them, especially if you’re new to credit.
• Risk of credit damage: If you miss payments or carry a high balance, this can negatively impact your credit score and make it harder to get approved for credit in the future.

When Should I Get a Credit Card?

The best time to apply for a new credit card depends on your financial position and goals. Generally speaking, the sooner you can start using a credit card to build stronger credit, the better. This being said, applying for a new card is a major financial decision and shouldn’t be done hastily. Though additional cards can be used for balance transfers and introductory APR periods can help finance larger purchases, credit cards have high interest rates and should be generally avoided as a means of borrowing large amounts for periods longer than a billing cycle.

Younger teenagers can become authorized users on parents’ or guardians’ cards in some cases, but must be 18 years old to become the primary account holder on a credit card. Very few issuers allow co-signers, so you’ll either need to qualify on your own accord or ask to be added as an authorized user on someone else’s account.

How Old Do You Have To Be To Get a Credit Card?

To become the primary account holder on a credit card, federal law requires you must be at least 18 years of age. Most card issuers also require the primary cardholder to show proof of independent income. Younger teenagers can become authorized users on parents’ or other adults’ cards in many cases and can present a way to help teens get a jumpstart on building credit and help teach your kids responsible financial habits.

Is It Okay To Never Have a Credit Card?

While it is not necessary to carry a credit card, giving up on credit cards completely may forfeit a number of opportunities for financial growth and benefit. Credit cards provide a relatively easy way to build a credit history which in turn is a requirement for borrowing money to make large purchases (houses, cars, etc.).

By foregoing credit cards, consumers may also miss out on rewards programs, fraud protection and any service requiring you to have a credit card on file—for example, renting a car or booking some hotel rooms. Debit cards can be used to do some of these things, but using a debit card comes with other disadvantages, such as tying up funds in your bank account. If you’re committed to living a life without credit cards you can certainly use a mix of cash, checks and debit cards and avoid the risks credit cards may pose.

Why Can’t I Get Approved for a Credit Card?

Several factors may make it more difficult for you to obtain a credit card. If you do not have a steady job or provable source of income, you are less likely to receive approval for a credit card. Similarly, if you have too much debt, a bad credit score and history, are under 18 or do not have a Social Security number, getting a credit card in your name can be very difficult. While there are ways to work around these issues—like becoming an authorized user or getting a secured card—it can take some persistence and patience while working through the process.

How To Get Approved for a Credit Card

To get approved for a credit card, start by checking your credit score with one of the top credit monitoring sites. Then search for cards that match your credit rating. While credit card companies don’t generally disclose the exact credit score that they require for their cards, some will provide a range such as Excellent, Good, Fair or Rebuilding.

Even if you don’t yet have a credit score, you might still be able to get approved for a secured card. Alternatively, you could wait to apply until you’ve had time to build credit through other means such as being added as an authorized user to someone else’s card.