Getting Started with Credit

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By Rachel Caballero, Community Development Manager at TruWest Credit Union

There are so many things to think about as a teenager – prom, graduation, attending college or trade school, building social circles, getting a job – but there’s also one other thing that can make or break the future; building and maintaining positive credit.
Credit is such an important part of adulthood that can affect many things. The ability to qualify for loans, interest rates paid on loans, deposits for cell phones and utilities, and even employment opportunities can be affected by credit. Understanding how to properly use and manage credit is very important. Taking the responsibility to learn is essential to building a positive history.

Here are some tips to help you be successful when building credit with a credit card:

Start Small

Begin building and learning how to manage credit with a low amount. Many credit cards have limits as low as $500, which is more manageable when just starting out. A secured credit card is a great option. With a secured credit card, you use your own money to back (or “secure”) the limit you are able to use with your card. As you use and manage your card, your credit history will grow. Eventually, you can ask for the card to be converted to a regular credit card.

Manage Payments

Credit cards are revolving loans, which means you borrow and pay back as needed. There are required minimum payments, based off a percentage of what you owe. These payments must be fully satisfied on time each month to create a positive credit history. Interest, or the “price” you pay to borrow the money, will be added on to any balance not paid by the due date. A good rule of thumb is to never spend more than you can pay back when the bill comes due, so you can avoid paying interest.

Set Goals

When learning how to use a credit card, setting goals is essential. One of these goals is budgeting for your credit card. Think of the amount you spend on the card like money coming out of your pocket. You should never spend more than the cash you have on-hand. Setting goals for spending is also important. Don’t carry your credit card with you in situations where you’ll be tempted to use it. Avoid online shopping sprees and bringing your card with you to places like the mall, where temptation can lead you to deviate from your goals.

Credit can be confusing, but starting small, managing your payments and setting goals should help put you on the right track.

About TruWest Credit Union

TruWest Credit Union is headquartered in Tempe, Arizona, and operates as a cooperative providing its members with a lifetime of quality financial services and a culture of caring for its members, employees and communities. TruWest is a strong and sound financial institution with more than 93,000 members and assets totaling more than $1.5 billion. TruWest® Credit Union has 12 branch locations – eight in metro Phoenix and four in Austin, Texas. For more information, visit