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Wondering at what age you can get a credit card? The short answer is you can apply for one when you’re 18. However, you may be able to get one sooner, or you might not be able to get one until you’re at least 21. Sure, getting a credit card helps with making larger purchases. Even more importantly, using a credit card responsibly allows you to build up your score to help you reach other financial milestones, such as renting an apartment on your own or securing a loan to purchase a house or a new vehicle. However, there are several factors to consider before you sign on the dotted line. Here’s what you need to know about when you should get a credit card.
At What Age Can I Get a Credit Card?Most credit card issuers allow you to apply for a credit card on your own as soon as you turn 18 years old. Unfortunately, it may be hard to get approved, since potential cardholders tend to require proof of steady income. One possible solution in this case is to get a co-signer.In most cases, those who are 21 years old are more likely to qualify for a credit card, since they may be able to prove they have their own steady source of income.Those under the age of 18 may be able to get a credit card by becoming an authorized user on someone else’s credit card. This means you'll have your own credit card, but the primary cardholder — generally a parent or legal guardian — is the one who is ultimately responsible for making payments. The minimum age requirements will vary by issuer, so it’s best to check to make sure.
How to Know If You're Ready for a Credit CardUnderstanding when you should get a credit card isn’t about age. Instead, it’s someone’s financial behaviors that makes them ready to have their own card. Before getting a credit card, you need to know what it means to be a responsible cardholder and make sure you’re consistent in those behaviors. Here’s a closer look at some indicators you may be ready for a credit card:
- You have enough income: If you’re looking to get a credit card on your own, you’ll need to prove to credit card issuers you have a steady income source. Be honest and see whether you make enough to apply for one. Even a part-job may suffice, though check the fine print before applying.
- You know how credit cards work: Part of being responsible with credit is understanding how it works and having a grasp on credit card terms. There are plenty of free educational resources out there that can show you the basics of credit and credit cards. Learn what it means to make purchases, and understand your responsibility when it comes to making payments.
- You’re organized: Are you someone who can juggle multiple school deadlines and hand in work on time? If so, you’re most likely someone who can handle making on-time credit card payments.
- You’re not easily tempted by impulse purchases: It can be easy to be swayed by shiny objects and rack up a huge balance on your credit card, only to find out you can afford it. If you can walk away from buying items you don’t need, then you might be ready for a credit card.
- You know how to manage money responsibly: Perhaps you’ve started budgeting your allowance or your paycheck successfully. If you’re in the habit of spending below your means — rather than going overboard — you’re most likely ready to handle the responsibility of a credit card.
- You have some savings: Though technically not required, having savings is useful so you won’t end up relying on a credit card in a pinch. Doing so could cause you to fall into debt. By having some savings, you can use that money instead if you’re falling short one month, or an unexpected expense arises.
Signs You're Not Ready for a Credit Card
Here are a few signs you may not be ready to get a credit card:
|Signs You’re Ready||Signs You’re Not Ready|
|You have enough income||You don’t have reliable income|
|You know how credit cards work||You’ve never created a budget|
|You’re organized||You frequently overdraft your accounts|
|You’re not easily tempted by impulse purchases||You make a lot of impulse purchases|
|You know how to manage money responsibly||You don’t understand why you can’t spend up to your credit limit|
- You don’t have reliable income: Getting a summer job but not working during the school year, for instance, may not be enough to convince card issuers to give you your own credit card.
- You’ve never created a budget: If you don’t know how to manage money at all, getting a credit card won’t help you in that regard. It’s best to get a handle on the basics before opening a credit card account.
- You frequently overdraft your accounts: If you’re consistently going over your bank account balance, it’s a sign that you’re likely to overspend with your credit card as well and dig yourself into unnecessary debt.
- You make a lot of impulse purchases: If you can’t control temptation, having a credit card could mean you’ll spend more than you make.
- You don’t understand why you can’t spend up to the credit limit: Just because you have a certain limit doesn’t mean you should max out your cards. This could be another sign that you don't understand how to be responsible with a credit card.
What Should I Look for When Getting a Credit Card?There are several features to look for when getting a credit card. Ideally, you should look for credit cards with no annual fee. Especially since you’re likely just starting out, you don’t want to have to pay to use your credit card.Another important thing to keep in mind when it comes to how to choose a credit card is APR, or annual percentage rate. Before opening a card, see what you may have to pay in interest if you carry a balance. It’s better to pay off your balance each month, but just in case, you’ll want to know what you may pay.Other things to check for include whether it’s a secured or unsecured credit card. A secured credit card requires you to put down a cash deposit, which serves as your credit line, whereas an unsecured card doesn’t. In general, secured credit cards are easier to qualify for — just check to see if there’s a minimum amount you need to put down and whether you can afford to apply for one.
Ways to Get a Credit Card As…
Depending on your age, income and credit history, there are several ways you may be able to secure a credit card — even without much credit history. Options include:
|… A High School Student||… A College Student||… A Recent Grad|
|Become an authorized user||Become an authorized user||Become an authorized User|
|Apply with a cosigner||Apply with a cosigner|
|Get a student credit card||Consider a secured credit card|
- Becoming an authorized user: You can ask a trusted relative or your parents to become an authorized user on their credit card. There are risks for the primary cardholder, so make sure you’ll be responsible with the card.
- Applying with a cosigner: Another option is to ask another person to back up your credit card application using their income and credit history. Just keep in mind that this could affect their credit history if you’re not responsible.
- Signing up for a student credit card: There are cards designed for students, though they tend to have lower credit limits. Still, it can be a good way to build your credit.
- Getting a secured credit card: Secured credit cards tend to be easier to qualify for because you need to put down a deposit, which you should be able to get back once you upgrade to an unsecured card.
- Consider an unsecured credit card for fair credit: Not all unsecured credit cards require secured credit. If you’re still working to build your score, you might consider credit cards for fair credit.
Are There Credit Cards to Help You Build Credit?Many credit card issuers offer secured credit cards, student credit cards or unsecured cards aimed at helping card holders build credit. These cards tend to have lower credit limits. If you consistently make on-time payments, however, you may be able to increase the limit and open up opportunities for other types of credit cards, such as a travel rewards card or a cashback card.
Should You Get a Credit Card to Finance Large Purchases?Whether you should finance a larger purchase with a credit card depends on if you’ll be responsible with your payments. If you can’t afford even the minimum payment, it might be best to save up for the large purchase if possible rather than taking on debt.
Can You Use Credit Cards to Pay Off Debt?You can indeed use a credit card to pay off debt by transferring the balance of a credit card with a higher APR to a balance transfer credit card. However, you’ll usually need good to excellent credit to qualify for these types of cards, which might not make them accessible to those looking to get their first card.Balance transfer credit cards often offer interest-free periods, which you can take advantage of to pay off your debt faster, as your entire payment will be going toward the balance when you’re not paying interest. Just make sure to check the fine print to see if there are any fees involved and whether there are any other restrictions.
Compare Credit Card Offers With LanternGetting a credit card is a huge responsibility, and understanding when you’re ready for one ensures you’re in a good place to do so financially. It may be better to hold off if you believe you’re not yet ready for the responsibility, as misusing your credit card can have very real financial consequences. If you are ready, however, using a credit card can help you build your credit score early on.When it comes to getting your first credit card, shopping around is key. That way, you can find a card that suits your needs and habits. Lantern makes it easy to compare credit building cards by compiling details about the cards you may qualify for all in one place.
Photo credit: iStock/roshinio
About the Author
Sarah Li CainSarah Li Cain is a finance writer and podcast producer focusing on topics such as credit, insurance, investing, and real estate. Her work has appeared in major publications such as CNBC Select, Forbes, Redbook, and Business Insider.