Getting your first-ever credit card? 6 tips to get the most out of it

If used responsibly, credit cards improve credit health, which is key to future borrowing

Dubai: Your first credit card can offer independence, convenience, and the opportunity to build your credit. If used responsibly, it can improve your credit health, which is essential for future borrowing. Here are six tips every first-time credit card user should know.

1. Keep Your Spending in Check
   It’s crucial not to spend more than you can afford. Aim to use no more than 30% of your credit limit to maintain a good credit history. Stick to planned purchases, search for the best deals, and ensure you can pay off the balance before making the purchase.
2. Pay on Time
   Late payments can lead to late fees, higher annual interest rate, and even a negative impact on your credit score. Set up automatic payments through your bank’s app to ensure you’re never late.
3. Pay Your Balance in Full
   Paying off your balance each month prevents debt from accumulating. If you can’t pay in full, at least pay more than the minimum to reduce your balance faster and save on interest charges.
4. Review Your Charges Regularly
   Monitor your credit card purchases through online banking or mobile apps. Set alerts for due dates, suspicious charges, or when you’re nearing your credit limit. If you lose your card or spot a fraudulent charge, you can report it immediately.
5. Check Your Credit Report
   Regularly review your credit report from the three major bureaus: Equifax, Experian, and TransUnion. You’re entitled to one free report per year. Look for mistakes, such as duplicate debts or incorrect balances, and dispute any errors to protect your score.
6. Know Your Credit Score
   Your credit score is a reflection of how reliable you are at repaying debt. Many banks provide free access to your score, so check it regularly. If you’re building credit for the first time, consider a secured credit card to help establish your credit history.

By following these tips, you can manage your first credit card responsibly, avoid debt, and set yourself up for long-term financial success.