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Start smart with your first credit card

Your first credit card can bring independence, convenience and opportunity all rolled into one. When handled responsibly, your first credit card can help you build credit and improve your ability to borrow money in the future. Here are seven basic steps to making the most of your first credit card.


Use your first credit card wisely

One rule of thumb for building a strong credit history is to spend no more than 30 percent of your available credit line. That means being mindful of your spending; if you use your card as ready cash, you can burn through your available credit in a hurry. Keep your card for planned purchases, take your time hunting down the best deals and make sure you have a plan to pay off the purchase before you swipe.


Pay on time

If you've never had a credit card, you may not be aware of the consequences of missing a payment. One missed or late payment can lead to interest charges as well as late fees. Beyond that, late payments have the potential to ding your credit score.


Pay your balance in full

Paying your balance in full is the best strategy to avoid accumulating debt. But if you can't, paying more than the minimum payment due can save you money in interest charges in the long run. If you're curious how much money, we put together a closer look at how paying more than the minimum can save you hundreds, even thousands, long term.


Know your credit score

When you go to borrow money, the first things the lender looks at are your credit history and credit score. The score is basically a measure of how reliable you are about borrowing and paying back money. The higher your score, the better your chances of being approved for a card and the lower your interest rate is likely to be. If you have a low credit score, or no established credit, consider starting with a secured credit card to build your credit history.


Check your credit report once a year

Now that you're actively building credit via your first credit card, it's a good idea to monitor it. Three major credit bureaus keep track of your credit history: Equifax, Experian and TransUnion. You're entitled to a free report from each of them once a year. To get your free credit report, simply visit or call 877.322.8228. Check your report to make sure there are no mistakes, since errors can hurt your credit score. If you find an error, we've put together some tips on what to do if you find a mistake in your credit report.


Monitor your account

It's a good idea to keep track of your credit card purchases. One of the easiest ways to do this is online or via your card's app. Accessing your account online gives you real-time access; you don't have to wait for a monthly paper statement to check account activity, review your spending habits and spot opportunities to cut back. You can also check for any suspicious charges. Depending on your card issuer, you may even be able to get automatic alerts so you can monitor your accounts with less effort. These alerts generally tell you when you're close to your total credit line, when bill payments are due and more.


Protect yourself from fraud

Now that you're monitoring your account for suspicious activity, you'll want to know what to do in case you spot any. Review your bank's privacy and security policies to find out how you're protected in case your credit card number is stolen. Learn how to protect yourself from fraud and what to do if you become a victim. A few simple tips: Never give out your credit card number over the phone unless you initiated the call, memorize your passwords and PIN numbers and keep them in a safe, secure location and check your account often to monitor for unusual activity. You now have the tools to start smart with your first credit card.

Learn more about Bank of America's credit card options.

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The material provided on this website is for informational use only and is not intended for financial, tax or investment advice. Bank of America and/or its affiliates, and Khan Academy, assume no liability for any loss or damage resulting from one’s reliance on the material provided. Please also note that such material is not updated regularly and that some of the information may not therefore be current. Consult with your own financial professional and tax advisor when making decisions regarding your financial situation.

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