5 Things to Do With Your First Credit Card

To make sure that your score is being helped by current credit utilization ratio, Harzog says to keep your usage to around 10%, while Bruce McClary of ClearPoint Credit Counseling Solutions says you’ll need to keep charges under 50% to make sure the score isn’t hindered.

The one thing you’ll absolutely want to refrain from is maxing the card out, which will send your credit utilization ratio soaring in the wrong direction and could also serve as a portent of doom.

“You need to establish positive habits right away,” McClary says.

Keep a low credit limit.

You can also help yourself build credit by managing the limit itself. This can be more difficult than it sounds as issuers are often quick to offer to raise the limit on an existing credit line once the holder has shown they can handle the original one.

“Communicate with your issuer and tell them where you’d like your limit to be set,” McClary says. “You can also tell them that you don’t want the limit raised unless you ask them to.”

Harzog suggests keeping your credit limit at $1,000 or lower while you are building credit.

Stay on top of your spending. 

You also shouldn’t raise your credit limit until you know how much you can afford to put on your credit each month. To figure this out, Harzog suggests using your first credit card as a reason to set a budget.  

“Track your spending,” she says, using budgeting sites like Bundle or Mint, which can send you email alert if you’re about to go over budget.

Similarly, McClary also suggests setting up alerts either on your phone or even plastering some Post-its on your refrigerator so that you remember to pay the bill on time. Those who know they are particularly forgetful might also considering setting up an automatic bill pay, though McClary admits this might be difficult if your bill varies greatly from month to month.