Getting your first credit card is like moving into your first apartment: It’s exciting, and, once you get used to it, pretty underwhelming.

Your first time out, “you are not going to have a credit card that is going to have a high limit,” said Paul Golden, spokesman for the National Endowment for Financial Education. 

A starter credit card is just that — a start. Used responsibly, it’s a way to build a positive credit history, which will help you with things like getting a better deal on a mortgage and it will help you qualify for a card with better terms down the road. Here’s what you should look for.

Ease of approval. When you have a thin credit file and limited income, you are not likely to qualify for a card packed with benefits. Instead, aim for something more basic.

If you already have a credit history that shows consistent on-time payments — say, from repaying student loans — it is possible to qualify for a regular “unsecured” credit card that doesn’t require a deposit. To increase your odds of approval, apply through the bank you already use or with a preapproved offer received in the mail. If you are in college, look into a student credit card.

Don’t have a credit history yet? Consider applying for a secured card, one that requires a cash deposit. Or ask a parent to add you as an authorized user on a card with a history of on-time payments and a balance that’s far below the limit.

No annual fees. Avoiding an annual fee on your first credit card allows you to keep the card open for a long time at no cost. That can bolster your credit scores if you continue to make on-time payments.

Useful rewards. When Zina Kumok applied for her first credit card at 22, she wanted a sign-up bonus — one that she could earn easily.

“I wasn’t making a lot, and I was trying not to spend a lot” at the time, said Kumok, now 29, a freelance writer in Indianapolis who covers personal finance.

“I didn’t want to feel like I was being pressured to spend more to reach a bonus, which obviously never works out in your favor,” she said. Kumok opted for a card with versatile cash-back rewards and a sign-up bonus with a modest spending requirement.

Follow Kumok’s lead: Look for a card that will reward you for the spending you are already doing to avoid overspending to land a sign-up bonus.

Keep in mind that cards with rewards tend to charge higher interest rates. But if you expect to pay your bill in full every month, that shouldn’t be a deal-breaker.

“The APR only matters if you don’t pay off your balance,” Kumok said.

Reporting to all bureaus. Your first credit card has a simple purpose: to demonstrate to lenders that you can handle credit responsibly so you can borrow money when you need it later on.

Make sure the card reports to all three of the major credit bureaus: Experian, Equifax and TransUnion. Most credit cards do, but if you are unsure, contact the issuer.

Applying for your first credit card is simple, but building a credit history takes more effort. Some basics:

• Stay well below your limit. Using too much of your limit could sink your score.

• Pay your balance in full and on time every month.

• Make a plan. To avoid overspending on your new credit card, set a weekly budget and keep tabs on your accounts.


Claire Tsosie is a writer at NerdWallet. E-mail: Twitter: @ideclaire7.