How to make your credit card work for you

Credit cards can be an important tool toward building a healthy financial future. When used responsibly, credit cards can help you establish a solid credit history, making it easier to finance larger purchases – like a home or vehicle – in the future.  

Even if you don’t have a strong credit history, you can still qualify for a credit card. JPMorganChase explains how you can apply for a credit card, what to look for in a credit card and how credit cards can help you achieve your future financial goals.

How do I get started?

If you already have a checking or savings account in good standing, consider applying for a credit card at your current bank. You can apply online or visit a bank branch to work with a representative. Make sure to ask about all their credit card options.

You can also apply for a card online through any financial institution. Wherever you apply, you’ll usually need to provide your Social Security number or an individual taxpayer identification number, source(s) of income and evidence of monthly housing or rent.

What should I look for in a credit card?

You may find it helpful to find a card with no annual fee so you don’t have to pay money out of pocket just for carrying the card. You may want to make sure your credit card issuer reports to all three credit bureaus. This way, you can build credit history across the board and improve your chance of getting future credit cards and loans.

How can I use credit cards to build credit?

There are multiple ways to use credit cards to help establish credit and increase your credit score. Make your payments on time and avoid “maxing out” your card — maintain a low balance by keeping your credit usage below 30% of your card’s limit.

Time is the best way to build credit history, so make sure you keep your credit card account open even if you don’t use the actual card much.

What if I don’t have a credit history?

While this likely won’t block you from getting a credit card completely, it can affect the types of cards and terms you’re approved for.

Card issuers consider factors like your credit score, income and employment. Your credit history heavily influences your credit score, so if you don’t have a credit history, your card may come with higher interest rates. You might also have a lower credit limit because you haven’t yet proven you can pay back money on time.

Eventually, you can build a strong credit history through on-time payments, which may make you eligible for lower interest rates and higher credit limits.

If you don’t qualify for a regular credit card, consider starter credit cards for those new to credit, including:

• Student credit cards. These cards are usually built for students who haven’t had a credit card before and are looking for helpful benefits, like no annual fees.
• Store credit cards. Retailers can approve applicants with little credit history for a card. Store cards usually carry a higher interest rate, but payments still become part of your credit profile. Remember to try to pay off the balance each month to help avoid raking up interest.

You can also ask to become an authorized user on someone else’s card. If the other person makes their payments on time, that will reflect on your credit report as well.  

Get good credit with credit cards

Applying for and using a credit card responsibly can be a step toward building a solid financial future. As you establish your credit history, you can use tools like Chase Credit Journey to check and monitor your credit so you can stay on track towards your financial goals.

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For informational/educational purposes only: Views and strategies described may not be appropriate for everyone and are not intended as specific advice/recommendation for any individual. Information has been obtained from sources believed to be reliable, but JPMorgan Chase & Co. or its affiliates and/or subsidiaries do not warrant its completeness or accuracy. Deposit products provided JPMorgan Chase Bank, N.A. Member FDIC

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