Credit cards have become an essential part of our lives today as many of us find it very difficult to manage our expenses without them. Credit cards are a blessing for the people who use them responsibly and to use them responsibly, you should have a source of income. Many people out there think that they should get a credit card as soon as they find a job whereas others believe that it’s not a good idea. But, which one would be the right decision? Financial decisions should be made very carefully as a wrong decision of yours can lead to very poor financial health. So, we are here to make you understand how getting a credit card when you start a job can be the right decision provided you keep some key points in mind.
Benefits of Getting a Credit Card When You Start a Job
Build Your Credit Score
Your credit score plays a huge role in the approval/disapproval of your credit card/loan application. When you turn 18, you become eligible to build a credit score and that’s when you should start worrying about it. However, most credit card issuers want you to be at least 21 years old to have a credit card but you can still get one from the card issuer who provides credit cards to 18-year-olds as well. When you start a job, that’s the very right time to get a credit card if you didn’t have one already. In the beginning, you may find some difficulty in getting a credit card and hence you can start your journey with a secured credit card. It is better to learn to manage credit cards from the beginning so that you can build a credit score that will help you have premium cards in the future.
Make Big Purchases
When you start a job, you feel like now you can make all your dreams come true. be it buying some electronic appliances for your home, buying an expensive gift for your parents, or anything, you can do it using your credit card. Credit cards provide you with an opportunity to make big purchases for which you can pay later. If you want to make a big purchase that is worth more than your income, you can buy it on credit card EMI and pay a small part of it every month. What you need to do is just make sure that you pay your bills on time.
When you start a job, saving more and more might be what you are aiming for. Credit cards give you an amazing opportunity to save on almost all your spends. Some credit cards provide you with cashback and others earn you reward points that you can redeem against various options. So, it would be a great idea to save something every time your purchase something using your credit card rather than purchasing it using cash.
Points To Keep in Mind
- Before applying for a credit card, make sure that you are going to be stable with your job and prefer getting a card only after you have completed at least three months with your current organization. If you get a credit card at the very beginning and then leave a job, you can find yourself stuck under high debt as you will have no source of income.
- If you have some ongoing loans, make sure that you make your payments in time as your payment behavior is the most important thing that is considered while preparing your credit report. It would be even better to apply for a credit card, once you clear all your past dues.
- Having a credit card is not a task but managing it well is one. After getting the credit card, make sure to use it responsibly. Pay your bills on time every month, don’t use 100% of your credit limit, and make sure to check your credit report regularly. Achieving a good credit score can help you a lot in your credit journey while having a bad score can lead to poor financial health.
Everything can have positive as well as negative consequences. Getting a credit card when you just start a job can be a good decision for people who use it responsibly whereas it can be a poor decision for others who find it difficult to manage their card and hence are left with unmanageable debt. Everyone can make it the right decision for them by keeping the above-mentioned points in mind. So, if you have started a job and wanting to have a credit card, you can go for it.