What really matters with your first credit card

Getting your first credit card is like moving into your first apartment: It's exciting, and, once you get used to it, pretty underwhelming.

Your first time out, "you are not going to have a credit card that is going to have a high limit," said Paul Golden, spokesman for the National Endowment for Financial Education.

A starter credit card is just that — a start. Used responsibly, it's a way to build a positive credit history, which will help you with things like getting a better deal on a mortgage and it will help you qualify for a card with better terms down the road. Here's what you should look for.

Ease of approval. When you have a thin credit file and limited income, you are not likely to qualify for a card packed with benefits. Instead, aim for something more basic.

If you already have a credit history that shows consistent on-time payments — say, from repaying student loans — it is possible to qualify for a regular "unsecured" credit card that doesn't require a deposit. To increase your odds of approval, apply through the bank you already use or with a preapproved offer received in the mail. If you are in college, look into a student credit card.

Don't have a credit history yet? Consider applying for a secured card, one that requires a cash deposit. Or ask a parent to add you as an authorized user on a card with a history of on-time payments and a balance that's far below the limit.

No annual fees. Avoiding an annual fee on your first credit card allows you to keep the card open for a long time at no cost. That can bolster your credit scores if you continue to make on-time payments.

"I wasn't making a lot, and I was trying not to spend a lot" at the time, said Kumok, now 29, a freelance writer in Indianapolis who covers personal finance.

"I didn't want to feel like I was being pressured to spend more to reach a bonus, which obviously never works out in your favor," she said. Kumok opted for a card with versatile cash-back rewards and a sign-up bonus with a modest spending requirement.

Follow Kumok's lead: Look for a card that will reward you for the spending you are already doing to avoid overspending to land a sign-up bonus.

Keep in mind that cards with rewards tend to charge higher interest rates. But if you expect to pay your bill in full every month, that shouldn't be a deal-breaker.

"The APR only matters if you don't pay off your balance," Kumok said.

Make sure the card reports to all three of the major credit bureaus: Experian, Equifax and TransUnion. Most credit cards do, but if you are unsure, contact the issuer.

Applying for your first credit card is simple, but building a credit history takes more effort. Some basics:

• Stay well below your limit. Using too much of your limit could sink your score.

• Pay your balance in full and on time every month.

• Make a plan. To avoid overspending on your new credit card, set a weekly budget and keep tabs on your accounts.