4 Things To Do When You Get A New Credit Card
Getting a new credit card is exciting. It’s like getting a present or having a fresh start. You might get credit cards with high limits or new features. But as much as you might love your new card, there are some things you need to do before using it for the first time. Here are four tips for handling your first use of your new card.
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Cancel Your Old Credit Cards
Cancel your old credit cards. When you get a new credit card, consider canceling all the old ones. However, don’t cancel the one that still has a balance. You will want to avoid more years of interest charges and fees by paying off that balance as soon as possible.
If you have more than one card from the same issuer (e.g., Visa or Mastercard), notify them in writing that you have terminated your account so that they can cancel any automatic payments made through them (like for monthly bills).
Check Your Credit Report
The first thing you should do when you get a credit card is to check your credit report. You should do this every year, especially when you get a new card or two, to ensure there are no errors on it.
You want to ensure that all of the information in your credit report is correct (obviously), and if there are any new accounts, inquiries, or collections that weren’t supposed to be there. Also, check for public records like bankruptcies or foreclosures so you can have them removed from your record if they aren’t accurate.
Set Up Alerts
If you have a smartphone, the easiest way to set up alerts is through an app like Mint.com or Credit Karma. You can also do this on your bank’s website, but it will take more time and effort since it will require finding each account individually (this is a good time for creating folders!). You must go through this process even if you have no plans to make any purchases with your new card—alerts help protect against identity theft and fraud, so there’s no reason not to create them as soon as possible after getting approved!
Track Spending
You can track your spending with a budgeting app or just keep a mental note of how much you spend. If you’re worried about over-spending, set up alerts on your phone to let you know when it’s time to pay off some of the balance.
If you want to use a credit card for rewards, focus on getting one with high spending limits and low-interest rates. You should also look into getting one that offers purchase protection, extended warranties, and return protection—all things that come in handy if something goes wrong with an item after purchase or during the warranty coverage period.*
Credit card companies need to make money, too, so they will offer you all kinds of incentives. These can include a sign-up bonus and cashback rewards that you accumulate through purchases made on the card. It can be beneficial for you as well. As per the experts at SoFi, “Looking for a credit card that has more favorable rewards or offers perks that your current credit cards don’t have could be a good option for managing your debt.” But there are some things you should do before accepting any offer from a new credit card issuer.
