Are You Ready for a Credit Card?

Depending on who you talk to, the words, "credit card" mean one of two things: "danger zone" or "freedom, baby!" Having a credit card is both a blessing and a curse. Yes, it can encourage you to spend a little more freely without having to feel the burn right away, but it can also give you a rude awakening when you receive your monthly bill.

Let's take it back to 1920s America. It was the era of flappers, great jazz, and modern-day conveniences, like movies and cars. More leisure time and new financing options like generous bank loans and buying on credit, made people spend well beyond their means. For nearly a decade, everyone was buying like crazy. But unfortunately, that came to a tragic halt in October of 1929. Bummer.

Since then, the United States has ebbed and flowed in moments of economic prosperity and recession. But one practice that all Americans can do is establish responsibility with their credit. And responsibility is not necessarily something that everyone has once they turn eighteen and can legally apply for a credit card.

To qualify for a credit card, you must have a steady source of income that will prove to your bank that you can pay your bills on time and not drown in credit card debt. If you're so inclined to start early, there are special student or retail credit cards that may have easier qualifications. (Yes, you can still apply for a credit card if you have no credit.)

The most important thing to understand when you apply for a credit card is that it gives you a high risk of debt. But, if you are able to pay your bills on time, you can build your credit and qualify for greater purchases down the line. You'll have to have a strong credit score to buy a house, apply for a mortgage, or even to seek employment in certain domains. You can achieve this by starting off strong. Know your limitations by crafting a thoughtful budget. Here's a great budgeting resource to get you started.

While debit cards take money out immediately from your account, they don't help you build credit. To see if you're ready to pay a monthly credit card bill, total up all of your expenses month to month, and find the average. Then, see if you can save that amount every month. But the best way to get started is to find out as much information as you can. If you think you're ready for a credit card, then you need to figure out which card will be best for you.

Are you ready? Put your credit card knowledge to the test with this quiz!

PayPath
Follow Us on

Southwest Companion Pass

There’s all this talk about solo travel. And for good reason — no wasting precious time waiting for others to get their act together, take the plans out of the group chat and actually buy the tickets. Going solo, you can be spontaneous. You can plan your trips according to your precise tastes. You can hop on any flight and fly awayyyyyy.

Keep readingShow less

Jobs don't have to be miserable!

Photo by Madrona Rose on Unsplash

Though the wave of tech layoffs and the threat of a recession has overshadowed yesteryear's news of the great recession, everywhere you look, employees are asking for more — and getting it. Though this time of uncertainty could have given employers back the power, it's still in the hands of the workforce.

From Gen-Z's boundary setting and penchant for quiet quitting when they're being under-recognized, to labor unions and even the WGA writer's strike, we're in an era where workers can make demands about how they work — and where they work. And for many people, they want to work from home.

Keep readingShow less

Oh, how far we’ve come! Recently, it was revealed that — finally! — women CEOs at Fortune 500 companies outnumber male CEOs named John. A dubious milestone, but it's something to celebrate.

Though women have come pretty far in society, the progress we've made is far from enough. From the pay gap to daily microaggressions, it’s still obvious that women are treated as lesser than in society. This is especially clear when you look at how few female-founded businesses there are.

Keep readingShow less