How to Choose Your First Credit Card
Author Avatar

 

How to Choose Your First Credit Card

Getting your first credit card under your own name is a pretty big milestone for most young adults. Besides signalling a real entry into the “real world”, credit cards are a great way to kick-start a blank credit record and teach a newbie about responsible borrowing. But with hundreds of cards flooding the market and no experience, how is a first-timer to choose?

Yes, there are definitely a lot of cards and what they offer you will be vastly different. So, before you get frustrated and just apply for the most convenient card around, some factors need to be considered. Here are our tips to help you along.

Which Credit Cards Are Available At Your Salary?

A good way to start narrowing down your options is by looking at the basic minimum income requirements of your credit card choices. If your salary isn’t high enough to meet a certain card’s requirements, you won’t be able to apply for it. Generally, cards with more attractive benefits have higher minimum income requirements.

That’s not to say that newbies have limited options! Many banks have an eye out for fresh graduates and adjust the minimum income requirements accordingly. It’s all too easy nowadays to get your first credit card. There are several that have a minimum annual income requirement of RM24,000 – the Standard Chartered JustONE Platinum Mastercard is one such card – which means you can get a credit card with a salary of RM2,000 a month.Though the general rule is that credit cards with the best benefits are only reserved for the rich, there are plenty of useful entry-level cards that help you make the most of what you spend.

Prioritise Cards With No Annual Fees And Low Interest Rates

When you’ve just entered the working world, for the most part you are probably starting at a fresh grad salary. You will be learning the ropes where money management is concerned and are likely to have many more bills to pay than when you were studying.

Considering these challenges, the last thing you want is for your credit card to be an unnecessary burden. Bearing this in mind, you should always choose the card with the lowest interest rate and no annual fees.

Generally, most cards charge a hefty interest rate on outstanding balance that are around the 15% mark. That’s a huge amount, so always remember to pay off your credit card bills in full. But more importantly, look for credit cards which have zero annual fees or as the banks like to call them, “free for life” – the Maybank 2 Gold is a good example. You should be careful here, as many credit card companies claim to offer a waiver on annual fees, but they then slip conditions such as using the card a certain number of times in a calendar year, or the fee waiver is only applicable when you spend a specific amount with the card in a year.

It’s best to avoid the cards with sneaky terms for now. When you’re just getting used to work and life as an adult, waivers that attach themselves to spending could turn out to be a motivator to fall hopelessly in debt. That said, but don’t let this be a deterrent. Some good credit cards are free for life, like the Public Bank Quantum Visa card, while there are those with a “12 swipes a year” requirement that can easily be achieved by using your credit card on essential spending such as pumping petrol or buying groceries – the Aeon Big Visa Gold and Hong Leong Mach Visa cards are good example.

Match The Card Benefits To Your Lifestyle

You’ve probably already narrowed your choices down to a few cards and here’s where the fun starts. Now you get to decide which perks suit you best. Credit cards in Malaysia come with a range of benefits from cashback, rewards points, and airmiles. Different cards offer different types of benefits and some benefits are better than others – for example, some cards may have higher cashback rates or offer benefits that cover more varied types of spending than others.

Seasoned credit card users often have a selection of credit cards offering different benefits, and they choose between which of their cards to use on each occasion. However, as a first-time credit card owner, you shouldn’t really be looking to reach this level yet. Think about your spending patterns and choose yourself a card that will benefit this the most. If you shop the most on weekends, get yourself a card like the Maybank 2 Gold Cards that prioritises weekend cashback. Or if you’re the type that shops online, look into cards that offer the best cash rebates for online spending such as the Public Bank Quantum Mastercard and Visa cards. Air miles benefits are generally reserved for the higher-end cards, while rewards points are complicated as the redemption rates vary from bank to bank. So for first time card owners, you should mainly focus on cashback benefits.

 

Get Ready to Own Your First Credit Card!

To sum up, in order to get your first credit card you’ll have to knuckle down and do your research. Visiting the credit card pages of each individual bank may be a bit of a chore, so make your life a bit easier by using a comparison tool where you can see how the different credit cards stack up against each other all in one place.

Of course, after you’ve actually decided on which credit card you would like to apply for, you have to actually apply for it. Don’t get put off by the thought of a lot of paperwork, waiting around for phone calls, or trips to the bank – it’s actually much easier than you think. One of the quickest ways to apply for a credit card these days is online, and websites like ours at RinggitPlus also throw in sweet sign-up gifts that you’re eligible for if your application is successful.

Once you’ve got your very first credit card delivered to you, remember not to get carried away with this newfound financial power in your hands. A credit card can be a friend or foe depending on how you treat it. So spend wisely and borrow responsibly, and you’ll find a world of benefits open up to you.

Have fun!

 

4.7 3 votes
Article Rating

SHARE

Comments (2)

Subscribe
Notify of
2 Comments
Inline Feedbacks
View all comments
Nadz
17 days ago

What if a person with no credit history and no prior loan commitments, only PTPTN loan, which credit card they can apply for?

Pang Tun Yau
15 days ago
Reply to  Nadz

While PTPTN loans don’t appear on your CCRIS, it does help with building credit health if you repay the instalments on time. Besides that, you can increase your chances of approval by applying for a card with much lower income requirements relative to your monthly salary. You can also try applying from the bank where you receive your salary, or from banks that are known to offer high chances of approval (such as Citi, Standard Chartered, and Maybank). Lastly, most banks also allow you to pledge FD to get a credit card – the amount pledged is equivalent to the… Read more »

Top Credit Cards Articles
Top Credit Cards Articles
Post Image
Things You Didn’t Know Can Help Reduce Your Credit Card Payment
Desiree Nair
- 14th March 2017
We’ve got a few ideas up our sleeves to help you bring down that bill and possibly even make future payments much more affordable!
Post Image
Frequently Asked Questions About Credit Cards
Guo Heng
- 28th June 2018
Do you have questions about credit cards or are you looking to apply for your first credit card? Check out our FAQ on credit cards for all the need-to-know information.
Post Image
What You Need to Know When Cancelling Your Credit Card
Diana Chai
- 20th September 2014
Have you thought about cancelling a credit card (or two)? Before you do - read this quick guide on what you need to know (and consider) before cutting your cards up!
Post Image
Public Bank Quantum Visa & Mastercard Review: The New Default
Pang Tun Yau
- 15th May 2020
5% cashback & no annual fees: are the Public Bank Quantum Visa and Mastercard the best entry-level credit cards in the market?

Related articles

Related Posts Image
Related Posts Image
Related Posts Image
Related Posts Image