#Are You Ready for a Credit Card?

Credit cards are usually on the top of many a new worker’s wish list. As we grow, we may experience more serious expenditures and commitments that require the planning and convenience offered by a credit card.

However, wanting a credit card is very different from being ready for the responsibility of having one. Can you be sure you are truly ready for a credit card? Test the waters first before diving into the pool of (almost no return) credit limits and statements. Here are five signs that show you are ready for this responsibility!

1. You Are Credit Worthy

Being credit worthy is the difference between receiving a rejection or approval for your new credit card application. As a new entry to the workforce; you’re probably not saddled with any other kind of loan. This is both good and bad for your credit rating.

Good, because you haven’t had the opportunity to miss a payment and mess the rating but bad, because you just have no score at all. With no payment history; it’s hard for banks to decide the kind of paymaster you will be.

However, this doesn’t mean you will be unsuccessful – the best way is to start with a ‘beginner’ or basic credit card and have at least 6 months of work to your name (and payslip!). This will help you look more attractive to banks.

2. You Are Financially Responsible

Do you pay your bills on time? Know how to control your spending habits? Do you keep a monthly budget? All of these are important questions to answer so you can decide if you are going to be able to manage the responsibility of a credit card without running up hefty bills.

It is important to be financially responsible as credit cards require discipline for knowing how and when to spend using a credit card. Payment not dealt with will certainly cost you in the long run in interest and fees.

3. Your Job is Stable

Although nothing in life is really guaranteed, you can at the least be more sure than doubtful about some things. If you are still on probation in a company or are employed for a short-term project, it’s reasonable to assume that your job is not as secure as could be.

Qualifying for a credit card often means having a permanent job and some banks may even ask for a letter of employment and confirmation. Beyond a matter of process, this point is also important as you don’t want to find yourself jobless and suddenly relying on your credit card as a crutch. It will be a move to regret.

4. You Know How Credit Cards Work

You may think you know – but do you really? Do you know how interest is charged, how payment works and what credit limits are? If you answered no to any of these questions – take a step back and find out.

Taking on any financial product means knowing just what it is! It’s also an added bonus if you equally know how to keep your card safe and how to maximise its benefits. We’re happy to say, these are all tips you can pick up by following our blog updates!

5. You Understand What a Credit Card is (and isn’t!)

To some people, the concept of a credit card may seem very much
complex. They fear it; hate it and may often blame it for the financial ruin they perceive in others. On the flipside, some see it as a magic plastic payment tool that will give them anything they want with no end.

But it’s important to see a credit card for what it truly is: a financial tool that can be both good and bad depending on what you do with it. Just like a gun cannot shoot without someone to handle it; a credit card can’t swipe without a user.

Use it well and it will serve you well. If you understand this about credit cards – you are ready!

Are you ready for the commitment? If so, take a look at our Xpress Apply service for fast and easy credit card applications.

 

• TAGS:
• Credit Score
• Credit Worthy
• Financial Advice
• Financial Behaviour
• Personal Finance
• Xpress Apply