Woman checks credit card account on phone

First-Time Credit Card Users: How to Use a Credit Card

Last Updated: December 17, 2021
4 min read

Congratulations on your first credit card! You just entered a new world of convenience, opportunity and, yes, manageable risk. The key to happy card membership is to know what you’re doing from the start, from managing your payments to keeping your card secure. Here are some tips for first-time credit card holders:

1. You don’t have to carry a credit card balance

One of the most persistent credit card myths is that using a credit card means racking up credit card debt, but this isn’t true. You can buy everything on credit cards and never pay interest on purchases or any kind of fee, depending on the terms of your credit card account. Many credit card customers have at least a 21-day grace period before the issuer will impose finance charges on purchases. All you need to do is to pay your credit card statement balance on time and in full every month.

2. Don’t use your new credit card as a source of cash

In some cases, a credit card cash advance may be your ticket out of a tight spot, but never use cash advances casually. Unlike with purchases, you likely don’t have a grace period when it comes to a cash advance, so interest starts accruing the moment it posts to your account. Credit card issuers usually apply a cash advance transaction fee that can be 3 percent or more and finance charges are usually higher than your regular purchase APR.

3. First-time credit card owners should watch for overspending

You’re in a store, and you see something you really want. That’s fine; most shoppers have been there. But ask yourself — would you buy it if you didn’t have a credit card in your wallet? If the answer is no, avoid the impulse buy. Your credit card is a fantastic tool, and it can help you and make your life easier, but it can hurt you, too. Impulse buying is an absolute no-no when it comes to plastic.

4. Enjoy credit card protection for the first time

The list of credit card member benefits varies from card to card. In addition, you may not be liable for unauthorized purchases on your account. Check with your cardmember agreement for more details.

5. How to profit from your first credit card

Rewards or cash back credit cards, like those from Discover, provide a small rebate for every purchase you make. Since you’re spending the money anyway, there is absolutely no reason not to get something back. And this cash back can add up over time. The Discover it® Card, for example, allows you to earn 5 percent cash back on everyday purchases at different places each quarter like Amazon.com1, grocery stores, restaurants, gas stations and when you pay using PayPal2, up to the quarterly maximum when you activate. Plus, earn unlimited 1 percent cash back on all other purchases — automatically.

6. How to help keep your new credit card more secure

Now that you’ll be carrying a credit card, you need to pay attention to security measures. Don’t worry; it’s mostly common sense.

  • Don’t give your credit card number or any details of your credit card, including the expiration date or security code, out to others. Only use this information when making a purchase.
  • Avoid making credit card purchases on public computers or public WiFi unless you’re using secure connection services. Paying your credit card bills or making an online purchase at the coffee shop? Not an ideal spot.
  • Stay on the safe side and set up online alerts when a purchase exceeds a certain amount, to help monitor for possible credit card theft.
  • Check your monthly statements carefully, whether you receive them in the mail or online. Crooks don’t always go around spending thousands of dollars on a stolen credit card, raising all kinds of red flags. Some might make regular small purchases, which can make them harder to detect.

7. Use your new credit card regularly

Having a credit card for the first time means that you’re not in the habit of making purchases with a credit card. While it’s good to keep your debt low, you’ll want to make sure you use your credit card often enough that your card issuer doesn’t cancel your account for lack of activity.

Using your new card is responsibly also helpful in establishing a foundation for your credit history.

8. Credit card beginners should take steps to build a good credit history

As a first-time credit card holder, you’re just starting to build a credit history. Some factors that help raise your credit score are:

  • Paying bills on time
  • Keeping your balances low
  • Increasing average age of credit accounts

Using your credit card responsibly will help you gain a good credit score, which usually qualifies you for better interest rates on loans than someone with a low credit score.

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