How Old Do You Have to Be to Get a Credit Card?

A credit card allows individuals to borrow funds for purchases, with repayment typically including interest over time. Understanding the requirements for obtaining and managing a credit card is a fundamental step toward establishing financial independence and a healthy credit profile.

Understanding Age Restrictions

To obtain a credit card in the United States, an individual must be at least 18 years old, the legal age for entering into contracts. The Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009 introduced specific provisions for young adults, particularly those under 21.

Under the CARD Act, applicants between 18 and 20 years old must demonstrate proof of independent income sufficient to make minimum payments. If an applicant cannot show independent income, a co-signer who is 21 years or older with a verified income source becomes necessary for approval.

Pathways to Credit for Young Individuals

For young adults seeking to establish credit, several pathways exist. One common option is becoming an authorized user on another person’s existing credit card account, often a parent or trusted guardian. The individual receives a card linked to the primary account and can make purchases, which can help build a credit history if the primary cardholder manages the account responsibly. The primary cardholder retains full legal responsibility for all charges.

Secured credit cards offer another avenue for building credit. These cards require a security deposit, which typically becomes the credit limit for the card. This deposit is generally refundable upon responsible account closure or graduation to an unsecured card.

Student credit cards are designed for college students. These cards often have more lenient approval criteria compared to traditional unsecured cards, typically requiring proof of enrollment and sometimes a minimum income. Student cards may come with lower credit limits, often starting around a few hundred dollars.

Finally, a co-signed credit card involves a second individual, typically a parent, applying jointly with the young applicant. Both parties are legally responsible for the debt incurred. This arrangement can help a young person qualify for a card they might not otherwise receive, leveraging the co-signer’s established credit and income. Co-signing impacts both individuals’ credit reports.

Applying for Your First Credit Card

The application process involves providing personal and financial information. Applicants need to furnish their full legal name, date of birth, current address, and a Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN). Employment details and income information are also required, as lenders assess an applicant’s ability to make payments. For those under 21, only independent income sources, such as wages from a job or regular allowances, can be considered. Individuals 21 and older can include household income.

Applications can be submitted online. During the review process, lenders evaluate various factors, including existing credit history, reported income, and debt-to-income ratio. A “hard inquiry” is placed on the applicant’s credit report when a credit card application is submitted, which may cause a small, temporary dip in their credit score. This inquiry remains on the credit report for up to two years, though its impact on the credit score diminishes after one year.

Building and Maintaining Good Credit

Responsible usage is paramount for establishing and maintaining a positive credit history. Making all payments on time is the most significant factor influencing a credit score. Even a single payment reported 30 days or more past its due date can negatively affect a credit score, and negative marks can remain on a credit report for up to seven years.

Another aspect of credit management is keeping credit utilization low. This ratio is the amount of credit used compared to the total available credit across all revolving accounts, expressed as a percentage. Keeping this ratio below 30% demonstrates responsible credit management. For example, if an individual has a total credit limit of $1,000, maintaining a balance of no more than $300 is recommended.

Regularly checking credit reports is a sound practice. Individuals can obtain a free copy of their credit report from each of the three major nationwide credit bureaus (Equifax, Experian, and TransUnion) every 12 months. These reports should be reviewed for accuracy and to detect errors. Responsible credit card use, including on-time payments and low utilization, contributes to a strong credit score, which can lead to better terms on future loans, such as mortgages or auto loans.