“How to Start Building Credit at 18: A Comprehensive Guide”

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Consumer Credit and Finance Education

At O1ne Mortgage, we prioritize consumer credit and finance education. This post aims to provide an objective view to help you make the best decisions regarding credit cards. For more information, see our Editorial Policy.

How Old Do You Have to Be to Get a Credit Card?

To get your own credit card, you must be at least 18 years old in most states. In Alabama and Nebraska, the minimum age is 19, and in Puerto Rico, it’s 21. This is the age when you’re legally considered an adult and can accept the terms of a credit card agreement.

However, the Credit CARD Act of 2009 requires applicants between 18 and 21 to provide proof of income before being approved for a credit card. This prevents young adults with no source of income from being approved for credit cards they can’t afford.

If you’re under 18, you can become an authorized user on someone else’s credit card. As an authorized user, you can make purchases but are not responsible for paying the bill. Many credit cards allow authorized users as young as 13, though some issuers don’t set a minimum age limit.

Why It’s a Good Idea to Get a Credit Card at 18

Getting a credit card at 18 comes with several advantages:

• Begin building a credit history: Starting early gives you more time to gain experience using credit, which can make it easier to borrow money for significant purchases in the future.
• Access better fraud protection: Most credit cards offer zero fraud protection, ensuring you aren’t responsible for unauthorized purchases.
• Earn rewards on your spending: Rewards credit cards allow you to earn cash back or travel miles, which can be redeemed for flights, hotel stays, and more.
• Learn financial responsibility early: Managing a credit card helps you master money skills, preparing you for higher credit limits and larger loans.

What to Look For in a Starter Credit Card

Choosing the right credit card is crucial, especially when you’re just starting out. Here are some features to look for in a starter card:

• New credit or no credit accepted: Consider a secured credit card, which requires a security deposit and is easier to qualify for.
• No annual fee: Avoid unnecessary fees while you’re learning to use a credit card.
• Low interest rate: A low interest rate minimizes the amount you pay on any balance you carry from month to month.
• Offers rewards: While not essential, rewards can be a nice perk.
• Credit bureau reporting: Ensure the card reports to at least one major credit bureau to help build your credit history.

What Happens if You Get Denied for a Credit Card?

Being denied for a credit card can be disappointing, but it’s important to understand why so you know what to do next. The card issuer will send a letter explaining the reasons for denial. If your credit was a factor, the letter will list the reasons and tell you how to get a free copy of the credit report used in the decision.

Here are some options to build your credit score:

• Become an authorized user: Ask a trusted family member to add you as an authorized user on a credit card account they manage responsibly.
• Use other bills to boost your credit: Regular bills like utilities and streaming services can help build a positive credit history with Experian Boost®.
• Apply for a secured card or student credit card: These are great starter options aimed at people just starting out with credit.

The Bottom Line

Getting a credit card at 18 can be challenging, especially if it’s your first. Becoming an authorized user or getting a secured credit card are two viable options. Your first credit card may not have all the features you want, but as you build a positive credit history, you’ll qualify for better offers.

For any mortgage service needs, call O1ne Mortgage at 213-732-3074. We’re here to help you make the best financial decisions.

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