Credit / Debit Cards

Credit Card

Get Credit Card

How can I get credit?

If you do not have credit, the best place to start is with a credit card. Compare several credit cards. Apply for the one that gives you the best deal. Look for:

a low annual fee
a low APR, or annual percentage rate
lower fees:
a.) If a payment is late
b.) If you go over your credit limit
a long grace period. This is the time between when you spend money and when the card charges you interest. Look for one that is at least 25 days long.

If you cannot get a regular credit card, try to get a secured credit card. Apply only for cards that report your history to the three credit reporting companies.
Look for a secured card with:

no application fee
a low APR, or annual percentage rate
lower annual fees
no processing fees
higher interest rates on the money you deposit

Money Basics

Improve Credit

How can I improve my credit?

You can use credit to build and improve your credit history.

Use your credit card a few times a month.
Buy things you can pay for that month.
Pay the whole credit card bill every Do not leave a balance on your card.
Pay your bill by the date it is Paying even one day late will cost you money.

People who do this start to see a better credit history. But it takes time.

Money Basics

Getting a credit card

Credit Report

Getting a Credit Card

When you use a credit card, you're borrowing money. You pay less to borrow the money when you pay your whole bill each month.

How do credit cards work?
When you use a credit card, you’re borrowing money to buy something now. Later, you pay back the money, usually with interest.

You get a bill once a month for everything you buy with the credit card.
How do I get a credit card?
Banks and credit unions offer credit cards. You’ll need to apply if you want a credit card. When you apply, they check your credit history to decide:
- if you’ll get a credit card
- how much you’ll pay in interest and fees
Read Your Credit History Explained at consumer.gov/credit to learn more about your credit history.
How do I compare credit cards?
Compare at least three cards to get the best deal. Look for:
- a low or no annual This is what you pay to use the card for a year.
- a low APR, or annual percentage This is how much interest you pay every year.
- lower fees for things like paying late or going over your credit limit
What if I can't get a credit card?
You might be able to get a secured credit card. That means you deposit money with the bank or credit union. Then you spend that money by using the secured credit card.

Secured credit cards can help you build or improve your credit history. Just make sure you pick one that sends your information to the three credit bureaus.

Read Improving Your Credit at consumer.gov/credit to learn more.
Should I pay my whole credit card bill every month?
If you pay your whole bill every month, you probably won’t pay interest.

You might pay only the minimum amount due, also called the minimum payment. That means you’ll have to pay interest on the amount you didn’t pay back.

If you don’t pay the minimum amount due:
- your interest rate might go up
- you might have to pay fees
- your credit will cost you a lot of money
- it could damage your credit

Debit Card

Get Credit Card

What's the difference between a debit card and a credit card

When you open a checking account at a bank or credit union, you usually get a debit card. Read more about Opening a Bank Account at consumer.gov/yourmoney. Debit cards look like credit cards, but they use money you already have. Credit cards use money you borrow.

With debit cards:

You don’t get a bill every Money comes out of your checking account right away.
You don’t pay extra money in interest.
You don’t build a credit history.

With credit cards:

You get a bill every month.
You might pay extra money in interest if you don’t pay the whole bill every month.
You can build a credit history if you pay your bill on It helps even more if you can pay the whole bill each month when it’s due.

Money Basics

Prepaid cards are a different kind of debit card. You buy a prepaid card and load money on it to spend. Many have extremely high fees.

Improve Credit

When would I use a debit card?

Debit cards help you:

buy things without using a check or cash
get cash back when you buy something at a store
get cash at an ATM

Some debit cards are free to use, but some have fees.

Money Basics

What if I use all the money in my checking account?

Your debit card will be declined if your account doesn't have enough money. You won't be able to buy things. Some banks and credit unions have overdraft protection. This lets you use your debit card even when there's not enough money in your account. But you might have to pay an overdraft fee and interest.

Guard Physically

How can I keep my debit card safe?

Keep your debit card and PIN private. A PIN is a security code that you type in when you use a debit Never share your PIN or card numbers.
If you lose your debit card, let your bank or credit union know right away. Ask them to cancel the card and send a new card.
Ask your bank or credit union for account alerts by email or text. These remind you of how much money is in your account.

Your debit card use will show up on the statement you get every month from your bank or credit union. If you see a charge on your statement that you didn’t make, tell your bank or credit union right away. If you wait, you might not get your money back.