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My CC thread *NEW QUESTION 2/20 (at end)*

A

archcommus

Diamond Member
So I'll be turning 18 in about five weeks. Currently I use my debit for pretty much everything. I'd like to convert all that to CC. Not to spend more than I have or anything like that, but just for the reasons that all of you love your CCs so much, e.g. fraud protection, cash back, simplifies your banking records, etc.

Question is, how hard will it be to get one RIGHT when I turn 18? On one hand, I'm thinking easy, because offers are extremely rampant and it seems like they all want you to sign up. On the other hand, I thought it might be hard simply because of the fact that I have no credit yet, so they may not want me.

So will it be tough to get my first one or not?
 
get one of the student cards from bankone, discover, or amex. i started out with a $500 amex and now i can buy a new car with my cards if they let me to.
 
Originally posted by: archcommus87
So I'll be turning 18 in about five weeks. Currently I use my debit for pretty much everything. I'd like to convert all that to CC. Not to spend more than I have or anything like that, but just for the reasons that all of you love your CCs so much, e.g. fraud protection, cash back, simplifies your banking records, etc.

Question is, how hard will it be to get one RIGHT when I turn 18? On one hand, I'm thinking easy, because offers are extremely rampant and it seems like they all want you to sign up. On the other hand, I thought it might be hard simply because of the fact that I have no credit yet, so they may not want me.

So will it be tough to get my first one or not?
Click to expand...

About as hard as taking your next breath. 😉
 
Not hard at all...my son just turned 18 and walked into the bank, opened a checking account, got a debit card, and a $500 limit credit card all in one swoop.
 
Citibank has a couple that you can probably get. They're about the best CC company from what I can tell and I've never had a problem with them.

However, I would recommend to cap the balance at a fairly low amount and to not let them increase your credit line, as even if you think you'll be good and not run up a big balance, it'll be too much of a temptation.
 
Be sure to get one when the credit card companies are deluging you with offers... my girlfriend is 23 and has a hard time getting cards because she never built a credit history. Get one with no annual fee from a reputable bank, and never cancel it.
 
Originally posted by: Fenixgoon
depends on the card, but generally no... debit is also easy to get. i signed up the day i turned 18
Click to expand...

Debit is also useless for building credit history, and they usually don't give you the kind of rewards a credit card will.

Edit: Not that it's a bad thing to have obviously. I forgot my wallet at work this weekend, if I didn't have my spare debit card I'd be SOL for money. 😉
 
I opened my checking account and got a debit card at Citizens Bank last July, at the time of course I was 17. My parents are with Sky Bank but Sky wouldn't even give me a checking account until I turned 18. I didn't want to wait that long so luckily Citizens took me (and yes, independently, not tied with parents or anything) at that age.

Anyway, I've been using direct deposit with Sears and my debit card since then.

I say that a CC simplifies your bank records because all of your regular day-to-day purchases are wrapped up into one monthly bill, as opposed to having a withdrawal that must be recorded for every transaction like when you use debit.

I suppose a student card would be alright but I'd rather not have something that's geared towards the kiddies. Believe me, I don't have to worry about having too high of a limit, I'm a very thirfty and cheap person. Impulse buying does not exist for me.

So now the questions are what card to get, and how to start building my credit on the right track?
 
Just be careful when you get a credit card... it's almost the norm for young people to rack up thousands of dollars in credit card debt that will stay with them for years, accruing interest at ridiculous rates. If you get to the point where you're not paying it off in full every month, stop spending so much money.
 
As a student here in Florida, I get a free checking account at Bank of America, as well as a debit card that can behave as a credit card as far as protections go.

Does everything I need to, and I certainly am not interested in the possibility to drag myself down in debt so early.
 
Originally posted by: mugs
Just be careful when you get a credit card... it's almost the norm for young people to rack up thousands of dollars in credit card debt that will stay with them for years, accruing interest at ridiculous rates. If you get to the point where you're not paying it off in full every month, stop spending so much money.
Click to expand...
I don't intend to spend a dime over what I have unless necessary.

Let me make sure I understand how the APR will add up. Say I have a $600 balance and pay $400 off the first month. Say the APR is 8%. If I bought nothing more the next month, the next bill would be for only $201.33?? That doesn't sound right. I calculated that by taking 200*.08, and dividing that by 12, then of course adding it to 200.

 
Originally posted by: archcommus87
Originally posted by: mugs
Just be careful when you get a credit card... it's almost the norm for young people to rack up thousands of dollars in credit card debt that will stay with them for years, accruing interest at ridiculous rates. If you get to the point where you're not paying it off in full every month, stop spending so much money.
Click to expand...
I don't intend to spend a dime over what I have unless necessary.

Let me make sure I understand how the APR will add up. Say I have a $600 balance and pay $400 off the first month. Say the APR is 8%. If I bought nothing more the next month, the next bill would be for only $201.33?? That doesn't sound right. I calculated that by taking 200*.08, and dividing that by 12, then of course adding it to 200.
Click to expand...

Finance charges (interest) are based on your average daily balance. Add your balance every day to the previous day then divide that by 30 days.

I would recommend downloading Credit Card Math which is a FREE application. After you launch it, go to chapter 7 click forward until you reach the last page which has a little calculator.
 
Originally posted by: RossMAN
Originally posted by: archcommus87
Originally posted by: mugs
Just be careful when you get a credit card... it's almost the norm for young people to rack up thousands of dollars in credit card debt that will stay with them for years, accruing interest at ridiculous rates. If you get to the point where you're not paying it off in full every month, stop spending so much money.
Click to expand...
I don't intend to spend a dime over what I have unless necessary.

Let me make sure I understand how the APR will add up. Say I have a $600 balance and pay $400 off the first month. Say the APR is 8%. If I bought nothing more the next month, the next bill would be for only $201.33?? That doesn't sound right. I calculated that by taking 200*.08, and dividing that by 12, then of course adding it to 200.
Click to expand...

Finance charges (interest) are based on your average daily balance. Add your balance every day to the previous day then divide that by 30 days.

I would recommend downloading Credit Card Math which is a FREE application. After you launch it, go to chapter 7 click forward until you reach the last page which has a little calculator.
Click to expand...
I suppose I need a real world example to figure this out.

Say I spend $5/day every day of the year. Assume each month is 30 days. At the end of the first month, I'd owe $150, correct? No interest added. Say I pay $50. My balance is down to $100 and I keep spending $5/day. My average daily balance of course then would be $5. However my new balance would be $250, $150 of the current's month's purchases, and $100 of last month's purchases. This is where I get confused. Only that old $100 would be charged interest for month two's bill?

 
Not very, assuming you haven't done anything stupid in the past. Wait a few years, build up great credit and you'll be ripping up at least one card offer a day. It's kind of annoying, actually.
 
I'm not even 18 and I get offers in the mail from time to time.

Don't spend money you don't have.
Don't spend money you don't have.
Don't spend money you don't have.
Don't spend money you don't have.
Don't spend money you don't have.
DO NOT SPEND MONEY YOU DO NOT HAVE.
 
Just want to figure out EXACTLY how this interest gets computed and then would like opinions on the best offers from ATOTers here. I always like to do things right with good research.

Citizens, with whom I have my checking, has a standard Platinum Mastercard. 7.99%, 9.99%, or 12.99% APR, will double manufacturer warranties up to one year, 0% fraud liability, but no rewards of any kind. Might be an okay card but rewards or cash back would be nice.
 
Originally posted by: archcommus87
Originally posted by: RossMAN
Originally posted by: archcommus87
Originally posted by: mugs
Just be careful when you get a credit card... it's almost the norm for young people to rack up thousands of dollars in credit card debt that will stay with them for years, accruing interest at ridiculous rates. If you get to the point where you're not paying it off in full every month, stop spending so much money.
Click to expand...
I don't intend to spend a dime over what I have unless necessary.

Let me make sure I understand how the APR will add up. Say I have a $600 balance and pay $400 off the first month. Say the APR is 8%. If I bought nothing more the next month, the next bill would be for only $201.33?? That doesn't sound right. I calculated that by taking 200*.08, and dividing that by 12, then of course adding it to 200.
Click to expand...

Finance charges (interest) are based on your average daily balance. Add your balance every day to the previous day then divide that by 30 days.

I would recommend downloading Credit Card Math which is a FREE application. After you launch it, go to chapter 7 click forward until you reach the last page which has a little calculator.
Click to expand...
I suppose I need a real world example to figure this out.

Say I spend $5/day every day of the year. Assume each month is 30 days. At the end of the first month, I'd owe $150, correct? No interest added.

Say I pay $50. My balance is down to $100 and I keep spending $5/day. My average daily balance of course then would be $5. However my new balance would be $250, $150 of the current's month's purchases, and $100 of last month's purchases. This is where I get confused. Only that old $100 would be charged interest for month two's bill?
Click to expand...

1) Correct. Starting at $0 on first billing day (March 1) charging $5 per day x 30 days = $150 for the first billing cycle. So the end of your billing cycle is March 30th, this is your statement cut date.

Remember your $150 bill is due 25 days from the statement which is around April 25th. Your payment in full is due on or before April 25th, your due date.

If you don't pay your full balance of $150, first your outstanding interest is taken out of the the payment.

2) After your $50 partial payment your balance would be around $110 ($100 principal owed plus $10 interest). We're now into your second billing cycle (April 1 - 30th) and you continue to charge $5 per day. To calculate your average daily balance $110 + $5 per day then divide by 30 days.
 
Originally posted by: RossMAN
Originally posted by: archcommus87
Originally posted by: RossMAN
Originally posted by: archcommus87
Originally posted by: mugs
Just be careful when you get a credit card... it's almost the norm for young people to rack up thousands of dollars in credit card debt that will stay with them for years, accruing interest at ridiculous rates. If you get to the point where you're not paying it off in full every month, stop spending so much money.
Click to expand...
I don't intend to spend a dime over what I have unless necessary.

Let me make sure I understand how the APR will add up. Say I have a $600 balance and pay $400 off the first month. Say the APR is 8%. If I bought nothing more the next month, the next bill would be for only $201.33?? That doesn't sound right. I calculated that by taking 200*.08, and dividing that by 12, then of course adding it to 200.
Click to expand...

Finance charges (interest) are based on your average daily balance. Add your balance every day to the previous day then divide that by 30 days.

I would recommend downloading Credit Card Math which is a FREE application. After you launch it, go to chapter 7 click forward until you reach the last page which has a little calculator.
Click to expand...
I suppose I need a real world example to figure this out.

Say I spend $5/day every day of the year. Assume each month is 30 days. At the end of the first month, I'd owe $150, correct? No interest added.

Say I pay $50. My balance is down to $100 and I keep spending $5/day. My average daily balance of course then would be $5. However my new balance would be $250, $150 of the current's month's purchases, and $100 of last month's purchases. This is where I get confused. Only that old $100 would be charged interest for month two's bill?
Click to expand...

1) Correct. Starting at $0 on first billing day (March 1) charging $5 per day x 30 days = $150 for the first billing cycle. So the end of your billing cycle is March 30th, this is your statement cut date.

Remember your $150 bill is due 25 days from the statement which is around April 25th. Your payment in full is due on or before April 25th, your due date.

If you don't pay your full balance of $150, first your outstanding interest is taken out of the the payment.

2) After your $50 partial payment your balance would be around $110 ($100 principal owed plus $10 interest). We're now into your second billing cycle (April 1 - 30th) and you continue to charge $5 per day. To calculate your average daily balance $110 + $5 per day then divide by 30 days.
Click to expand...
Alright, so the first bill is interest-free. I pay $50, the rest gets interest added, that's where the $110 comes from. Now I continue to add $5/day. Still confused by the average daily balance, though. $110 + $5/day is the same as $110 + $150 for the next month, correct? Which is only $260. Dividing that by 30 gives a mere $8.67?
 
No, you need to add your balance on each day together and divide the total by 30. Your average daily balance in that scenario would be $187.50 (assuming $110 balance on day 0, $115 on day 1, ..., $265 on day 30).
 
Originally posted by: mugs
Be sure to get one when the credit card companies are deluging you with offers... my girlfriend is 23 and has a hard time getting cards because she never built a credit history. Get one with no annual fee from a reputable bank, and never cancel it.
Click to expand...
Yup. Carry a tiny balance (like $50 or so) and pay the minimum balance every month. Building credit can be fun 😉
 
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