For those of us just starting out on their own (as newly recognized citizens, or young people fresh out of college), Applying for that very first credit card can be a rather excruciating experience. Indeed, credit cards for people with no credit history can be very hard to acquire, given that any financial institution requires some sort of assurance or trust that potential credit applicants have the financial means for account deposits necessary for credit transactions. Take for example some lenders who will only approve certain loan amounts based on an individual’s credit history or insurance company premiums which rely heavily on said credit history. Absurd as it may be, the lack of credit history is but unfortunate proof of inadequacy (to put it more bluntly, lack of discipline) in handling finances.
As a first timer, it’s best to consider trying out various options like secured credit cards. Secured credit cards, or “no credit credit cards” are secured with a deposit that’s held in an account and used when you default on your payments. Many of these secured credit cards have minimum and maximum deposit limits. Do take note that some creditors will only use your initial deposit in cases of severe delinquency (5 -6 months, depending on their provisions). Be warned, though, that some secured credit cards place deposits in an interest-bearing account. Always ask questions and find out if your deposit will earn interest and if so, how much it would actually cost. Remember to look for bank cards with just payment history, and keep an eye out for benefits like low balance transfers and credit offers with little or no annual fees. It’s also a good idea to always be on the lookout for the best cash back credit cards, many of which offer annual rebates between 0.5 to 2% of your net expenditure. Some of these cash back credit cards offer reward points which can be redeemed at participating or affiliate commercial establishments for substantial discounts and various freebies.
In any case, always be sure to have adequate proof of your current financial standing (employment pay slips, bills paid on time etc.) as these help to convince your creditor of your financial maturity. Once you do get your card, Always make sure to take care of your credit card standing, as this will ensure you of higher trust ratings and ultimately bigger credit in time. Simple things like staying well within your credit limits and paying your bills on time are things that count in building your credit history. Lastly, it is highly advisable that you check your credit report annually.