Should I apply for a credit card even if I don’t need it now? %%sep%% %%site name%%


There are many reasons to consider getting a credit card, even if you don’t need to borrow money. A credit card can help you establish or rebuild your credit history, establish strong financial habits, and finance a major purchase. Plus, credit cards offer additional benefits, such as the ability to earn cash, points, and miles, among other lucrative rewards.

But on the other hand, there are also downsides to having a credit card, like the temptation to overspend and end up with a load of debt.

Ultimately, the decision of whether or not to get a credit card depends on your individual financial situation. You may already have a few credit cards in your wallet or you may be new to the credit card landscape. Whichever scenario is best for your wallet, let’s take a look at when it might make sense to get a credit card and when it might not make sense to get a credit card.

When to get a credit card

So should you get a credit card even if you don’t need one? In short, it depends.

It depends on many factors, including your current level of debt, how much income you earn, and how much credit you currently have. That said, you should never apply for a card you don’t want just to earn credit card rewards. If you don’t have a valid reason to apply for a credit card, it’s probably not a good idea to apply for one.

If you’re looking to build credit, a credit card may be the right next step on your credit journey. But if you’re still deciding whether to apply for a credit card right now, here are five reasons to consider:

Your credit could use a boost

If your credit isn’t in the best place, you’ll probably benefit from a credit card. Applying for a credit card can help you build a positive credit history by demonstrating that you’re willing to borrow money responsibly. Since credit card applications are considered a hard request, it may temporarily lower your credit score, but your score will likely increase after proving your creditworthiness.

If you make regular credit card payments on time and manage your credit usage, your credit score can only benefit from having a credit card in your wallet.

You need help building credit from scratch

Credit cards are a great way to help someone with no credit history establish a positive credit history. While there are many ways to build a positive credit history, a credit card is one of the easiest and fastest ways to do it. Although it may seem counterintuitive given that many credit cards require good or even excellent credit scores, there are a handful of credit cards available that cater to people with no credit score. Here are our picks for the best credit cards with no credit history.

You want to diversify your credit

Having multiple types of credit on your file can help improve your credit score and help lenders see you as a responsible borrower. In fact, the credit mix makes up 10% of your FICO score. Although it may seem small at first glance, multiple lines of credit can help lenders see you as someone who can manage your debts over time.

You want to finance a major purchase

Zero percent APR periods allow you to avoid paying interest on purchases for a limited period of time. Some credit cards offer 0% APR for 12 months, while others may offer up to 21 months. No-interest credit cards make it easy to finance a major purchase or unexpected medical expense without interest added to your balance.

However, the key to ensuring that a 0% APR period works in your favor is to pay off your balance before the period ends. So you will never have to pay interest. Here are our picks for the best 0% interest credit cards.

Want to earn rewards

Rewards credit cards offer lucrative benefits in the form of cash back, miles or points on everyday purchases. However, using a credit card to earn rewards isn’t always worth the risk. First, if you’re considering a rewards credit card and don’t have an established credit history, you may not be approved for a credit card.

The best rewards credit cards may require you to have good or excellent credit. Using a credit card to earn rewards is always a good idea only if you pay off your balance in full each month. If you cannot manage your balance, any rewards you may earn will not offset any interest accrued on your balance.

When not to get a credit card

Many people avoid applying for a credit card altogether because they don’t have a good credit score, or even no credit score at all. This is shortsighted, however, because credit cards can help you build a better credit score, even if you’re told you’re not ready for it.

However, although credit cards work for some consumers, they are not always the best option. Let’s consider a few cases where a credit card just isn’t a good option:

You spend beyond your means

Although credit cards offer a few benefits, they also pose a risk for people who spend more than they can really afford. It’s far too easy to fall into credit card debt simply by letting your balance spiral out of control. If you can treat a credit card as if you were taking cash, you’ll be on the right track.

Payment history makes up 35% of your FICO credit score, making it the most important factor when it comes to calculating your credit score. If you miss consecutive payments, you’re not only racking up a large amount in interest charges, but you’re hurting your credit.

You have outstanding debts on existing credit cards

If you can’t handle an outstanding balance on an existing line of credit, it’s probably not the best idea to add to the mix. Credit cards are not a band aid that can help solve an existing problem.

However, if you’re having trouble managing the balance on a credit card you already have, consider a balance transfer. This is the only scenario where it makes sense to get another credit card because you are transferring a balance from one account to another. More often than not, balance transfer credit cards offer cardholders an initial APR of 0% for a limited time (usually 12-21 months).

Keep in mind that balance transfers require a fee (usually between 3% and 5%), but with the right card, you can save a lot of money on interest while keeping your debt under control.

You were recently denied a credit card

Each time you apply for a new credit card, the lender performs a credit check – or an in-depth investigation – on your credit report. A credit check will temporarily affect your credit score, usually by just a few points. However, if you regularly apply for new lines of credit, your credit score will take a bigger hit. Lenders see this as a red flag, because too many credit inquiries can mean you’re incurring debt you can’t repay. If you’ve recently been denied a credit card or applied for more than one, take a step back and consider working on your credit score before applying again.

The bottom line

Credit cards offer many benefits, including rewards programs and the ability to build credit. However, credit cards can also encourage debt if you’re not careful. There are a handful of alternatives to consider if a credit card isn’t right for you, but take the time to consider your spending habits before deciding if a credit card is right for you. As long as you prioritize good financial habits and treat your credit card like you would your debit card, you’ll be fine.


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