The Basics of Credit Cards & Credit Scores
Every Credit Journey is Different
In this post I will talk about Credit Cards and Credit Scores, we have talked about these two things or have heard conversations but most of us don't know what they really are. No worries though everyone learns one way or another. Some of us had great Guidance, some of us had no guidance and unfortunately some of us have learned through trial and error. It is important to know that we all come from different walks of life and that's okay. Also before digging in I want to just address this real quick, Credit Cards are not evil. Credit cards are a tool and how we use it is up to us, only we have control over the card and not the other way around.
Secured Credit Card
First of all what is a Secured Credit Card?
When I started to understand the credit card options we had at the bank I worked for...this was my go to card. I would ask customers if they have ever had a credit card and when they would say no, I knew this would be the card to start with. So what is a secured credit card? well, let's start with this question... do you want what a security deposit is for an apartment? Typically you pay first months rent and then a deposit of the same amount incase there's any damage to the apartment while in your possession but if there's no damage you get it back... well this is the exact same thing! A Secured credit card is a credit card you put a deposit down and whatever you put down will be your available credit. Everyone is different and can only afford to put down a certain amount but the minimum is $200. Also after a year (some do 6 months) if you make your payments on time then you get your deposit back and then it will become just a regular credit card. You may also have the chance to increase your limit, which is tempting but only do it if you can afford it , and only if you have been responsible with your payments and can continue to do so. By doing all of this, you will be boosting up your credit score or building it if you haven't worked on your credit score yet. These cards are really good for fixing credit !
Credit cards are not like secured cards only because you do not have to put a deposit down. You get a credit card either because you took the initiative to apply to one or maybe you received one of those fancy & enticing letters in the mail that you are pre-approved. So how do you know which credit card to go with? I know a lot of people choose the name brand they know and "like", but there's more to it than that. One of the most important things to look at is the APR (Annual Percentage Rate) which I could describe to you but TBH I like Capital One and how simple they explain it. Okay, so speaking of capital one I will say this was my first choice in cards. I started with a secured card though, and it did have a high APR but at the time I got it I had none of this knowledge. Once I built my credit and my secure card turned into an unsecured card I did get a second credit card, not always recommended to have a lot of cards but I did stop at two and these have lower interest rates.
After all this talk about Credit Cards we can't leave out Credit Score! What is A Credit Score? it's a number between (lowest) 300 to (highest) 850 and the score you have determines your credit worthiness. If you have a low score no worries, that's what this whole post is all about and not to mention you don't have to go through ANY of this alone, you can book a session and I would most definitely look forward to helping you through your Journey! The best part of my sessions is you never have to be embarrassed.... Once I was 28 and realized what credit was, my score was a whole whopping 415 ( almost as low as I could get). So that being said, no worries we all have to start somewhere and we don't all have the support and guidance we should have had growing up and that's okay. Credit Score tells you your credit worthiness, but how do you check it?! When I started my journey I checked Credit Karma and no it's not 100% Accurate but I used it to just get an idea until I figured out how all this worked (at that time). There are many other resources which we can talk about a later time or through a session, but all credit card services also give you your score.
I hope this post helps you step in the right direction to Credit Cards and your Credit Score. In this post I mention Capital One a lot but remember I was figuring things out on my own, and also everyone's Journey is different and everyones choices will need to be unique to their Journey. Also, I call this a lifestyle because once you get started you will need to pay attention to it, maintain it and track it! Also if you want to Book a Session to start your Credit Lifestyle now (to start it or repair it) then I have 3 Month Sessions (with a Payment plan option) and I have a 6 Month option (with a payment plan option).... Just keep in mind Credit does not go up over night! this is something that will need to be worked on over time.
Thank you for taking the time to read this post and as always....
Have A Day As Beautiful As You Are
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