Every Credit Card Tip You Should've Been Taught At 15

Every Credit Card Tip You Should've Been Taught At 15

Sep 28, 2022

Clay Raterman

Here's everything you should have been taught about credit cards by age 15

(I'm going to try to save you time and explain it as quickly as possible using bullet points)

Why use a credit card:

  • You use a credit card so you earn points (free cashback + travel) and build a credit history so that you can get better interest rates on loans in the future.

  • You don't use a credit card so you can spend more money than you actually have in the bank. NEVER do this if it's it's purely on consumer goods and living expenses, this can create bad habits.

  • The only time it's advisable to spend money you don't have would be if it's to make additional money (of which there are a ton of risks to weigh here, it's very situation dependant).

How to use a credit card:

  • Treat the credit card like it's a debit card by never spending more than you actually have.

  • Set it to auto-pay before the statement date (so lower utilization is reported).

  • Get new credit cards every ~6 months when inquiries fall off.

  • Start with cards with no annual fees unless it's the primary one you use so you're getting the value of the benefits.

  • If you get cards with annual fees for the points bonuses, do the spend they require to get the bonus, and eventually call and downgrade to their no annual fee version.

  • Don't close credit accounts, it hurts the length of credit history.

  • Set all unused ones on auto-pay with a small subscription. Sometimes they will close on you if you leave them inactive for too long. Again we don't want them to close (see point above).

  • Sometimes you can "hack" your way to getting a higher score by being an "authorized user" on a family member's account who has a high score. This one is usually unnecessary if you just do the rest right and don't need a quick fix for some reason…but I figured I would mention it.

For the perfect credit score you need:

  • 21+ open accounts. This seems like a lot and it is, but it's doable over a long time with the right management! (or if you're okay with not a "perfect" score like I am, you can have less :)).

    • The higher the credit limits the better. You can call and ask for increases occasionally.

  • Diverse types of credit (home, auto, credit lines, cards)

  • Lower than 10% utilization (if you have $100,000 in total credit limit, you are using <$10,000 outstanding)

    • This one fluctuates. Some say up to 30% utilization is okay. I think the lower the better, but you need some.

  • No hard credit inquiries (or as few as possible)

    • This one is hard because you incur these when you apply for new cards and loans, which you have to do to get more open accounts. They fall off after 6 months though so just ensure you're managing that timeframe properly and not applying for too many at one time.

  • Long credit history. This just takes time to report to the different credit bureaus to build.

  • Don't have any late payments or derogatory marks. Simply pay everything on time and put it all on auto-pay. If a mistake happens, call the bureau directly and ensure you get any of these removed.


This is a QUICK bullet point list of everything you need to know about credit cards, your credit score, and how to play the game the right way in order to achieve the highest score you can!

Again - why do any of this?

Firstly because it teaches you how to properly manage debt, which is a valuable skill in our society today.

Secondly, because credit is a foundation of your personal finances and understanding this game can save you 10s of thousands of dollars over your lifetime based on the different interest rates you will be offered on debt like mortgages, auto loans, and credit cards.

The last reason this is important is that if you're seen as someone who manages your finances properly, there are usually opportunities that come your way that you'll be prepared to take advantage of. Not everybody has a good credit score and access to liquidity (cash), which means you can become a source for opportunities that otherwise wouldn't be available to you had you not been prepared.


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