Recently graduated college? You need to get a credit card

I opened my first credit card, the Petal 2 Visa Credit Card, shortly after graduating from college. At the time, I had no idea that one decision would eventually lead to me qualifying for some of my favorite travel rewards cards and taking trips I never thought I’d be able to afford.

When I was younger, my personal finance education was quite minimal. Credit cards were treated like some kind of financial boogeyman, capable of sending me deep into irrecoverable debt.

If you were taught to view credit cards in the same way, or if they’re just something you haven’t thought much about, I get it.

My perspective changed when I learned that everyday spending on a credit card could eventually earn me free flights and hotel stays.

Of course, to get there, you first need to build your credit history — and right after college is one of the best times to start.

The information for the Petal 2 credit card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Travel rewards can make trips affordable on an entry-level income

Back before I knew about travel rewards, I didn’t expect to be able to take trips too frequently. Between flights, hotel stays, food and activities, I knew I’d run up thousands in charges — not something I could easily afford as an entry-level professional in media.

But travel rewards completely changed that.

Thanks to the points and miles I’ve earned through my nine (yes, nine) credit cards, I’ve been able to do things like travel to Germany for 10 days, make meaningful progress toward my goal of visiting all 50 states and spend Christmas in Canada.

I’m about to head out on my next trip down to Mexico, another vacation that wouldn’t have happened without points.

None of this happened overnight. It took several years of responsibly using that first credit card before I qualified for the travel rewards cards that now make trips like these possible.

By doing the boring work of getting your first credit card and establishing your credit score now, you’ll set yourself up to have a high enough credit score in your mid-to-late 20s to get approved for some of our favorite travel rewards cards.

To give you an idea of how much money points can save you, I didn’t pay a dollar out of pocket for any of the 10 nights I booked during my Germany trip. Without points, those hotel stays would’ve cost thousands of dollars.

Your credit score takes time to build

Credit scores aren’t very interesting, but they are extremely important. A high credit score can mean the difference between getting a favorable rate on a car loan, getting approved for your first travel rewards card, or even receiving approval for an apartment.

If you took out student loans as I did, or if a parent added you as an authorized user to one of their credit cards, you probably already have some credit score to speak of.

Even if that’s the case, though, your score likely isn’t very high. Back when I graduated from college, my score was in the 600s (850 is the highest your score can be, although this is very hard to attain).

Contrary to what many people assume, having many credit accounts in good standing is viewed more favorably by credit bureaus than only having one or two healthy accounts. The average age of all of your credit accounts also plays an important role in determining your score, so it’s important to start building credit as early as you can.

Issuers often prefer an established relationship for higher-end cards

This is generally not something that issuers will confirm, but many datapoints suggest that major banks like Chase and Bank of America prefer a preexisting relationship before issuing someone a card with an annual fee like the Chase Sapphire Preferred® Card (see rates and fees) or Atmos™ Rewards Summit Visa Infinite® credit card.

While you could achieve this by opening a checking account with your chosen bank and using it for a while, you can also begin a relationship by opening a starter card.

For example, the Chase Freedom Rise® (see rates and fees) is specifically geared toward young adults with a low or nonexistent credit score. By opening this card and paying your statement balance in full every billing period, you’ll prove to Chase that you’re capable of handling a more sophisticated credit card.

In fact, after a year of responsible use, Chase will automatically consider you for an upgrade to the Chase Freedom Unlimited® (see rates and fees) — still a favorite in my wallet.

Credit cards can offer an easy way to pay for purchases over time

While I encourage everyone to pay their statement balance in full each month whenever possible, life doesn’t always go according to plan.

Many credit cards offer 0% annual percentage rate (APR) cards, which is a fancy way of saying you won’t pay any interest on purchases or balance transfers (depending on the card) for a set period.

This time frame can range from 12 to 21 months. Any amount left over after the introductory 0% APR period ends will be charged interest at your card’s regular rate, so it’s important to have a proper payment plan in place.

That can be a much better option than many buy now, pay later services because you’ll also build your credit history while benefiting from purchase protections and fraud protections.

Alternatively, some issuers also offer installment plans such as Chase’s Pay Over Time. These plans generally charge a fixed monthly fee, but that monthly fee is significantly cheaper than the interest you’d otherwise accrue. Sometimes you may even be targeted with a no-monthly-fee fixed-payment plan, which I definitely recommend taking advantage of.

Which no-annual-fee credit card should I get as a beginner?

You have plenty of options for your first credit card. I strongly recommend going with a card from an established bank, such as Capital One, Chase or Citi, rather than a card from a startup. My first credit card came from a startup, and it ultimately ended up being a bad choice.

If you’re building credit from scratch, consider options designed specifically for new borrowers, such as:

A secured credit card requires you to put down a certain amount, generally $200 or more, as a security deposit. That deposit will become your credit line. This is an extra step issuers take with certain cards to protect themselves from high-risk borrowers.

Keep in mind that approval for a credit card, even a secured card, is never guaranteed. Issuers will look at factors beyond your credit report, such as your income and housing payment.

If you’re currently searching for work or working part-time, I suggest waiting until you have full-time employment before applying for a card. Issuers are understandably very hesitant to issue a credit card to someone with a very limited income, unless they have significant savings (think tens of thousands or more).

If you already have some credit history through student loans or by being an authorized user on someone else’s card, you may qualify for a more traditional rewards card, such as:

For additional options, check out credit cards writer Augusta Stone‘s picks for the best first credit cards.

Bottom line

Looking back, opening that first credit card shortly after graduation was one of the smartest financial decisions I made.

As a recent graduate, there’s a lot to think about. But spending a little time building your credit now can pay dividends for years to come, whether that’s qualifying for your first apartment, buying a car or eventually earning the travel rewards that make dream trips much more affordable.

I had no idea my first credit card would eventually lead to flights, hotel stays and experiences I never thought I’d be able to afford. If you’re willing to start building your credit now and use it responsibly, you can put yourself on the same path.

The points and miles you earn with travel rewards cards are your key to incredible trips, from the beaches of the Dominican Republic to the Great Wall of China to Machu Picchu in Peru.

To learn more about points and miles, check out our beginners guide to travel rewards.