1. Purpose
Be conscious of your motivations. Why are you interested in getting a credit card? If it's for convenience in paying for purchases, remember that you can do away with cash payments using a debit card too.
Maybe you're tempted by the discounts and rewards you can get. While this makes sense, take note that in the grander scheme of things, those rewards may not be a good trade-off with the amount you have to spend to get them.
If your reason for getting a credit card is to build your credit score, that too has a safer alternative. Paying your car, rent, and utility bills on time for straight years boosts your credit score.
2. Age
The most obvious benefit of getting a credit card early is that you get to establish your credit score from a young age. A less obvious advantage is that you can learn how to manage your finances while you're barely out of your teenage years, so by the time you're in your late 20s or early 30s, you're already a pro.
However, that second situation can easily backfire. Younger people have a harder time saying no to temptations. For example, at 16, you'd probably rather go to a party and spend money you don't have than pay your outstanding credit card bill.
Those things considered; age is a vital factor. While there's no clear-cut rule on how to approach the matter, it's best to give yourself time to hone your financial acuity first before having one of those shiny plastic cards in your wallet.
Read more: Five Useful Resources on Personal Finance
3. Source of Income
Getting a credit card when your source of income is unstable is a big no-no. You'll be tempted to spend money you have no means of paying. Say yes to a credit card offer if, and only if, you have consistent receivables you can funnel into your credit card account to avoid compounded debt.
4. Credit Standing
A credit report will include your personal details and credit history, which should give you a hint at whether to get a credit card or not. A healthy credit score is encouraging. With the opposite, it's best to stay away from a credit card in the meantime.
If you want to access your credit score, you may request a credit report from the Credit Information Corporation (CIC).
5. Number of Loans
Having active loans at the same time can get overwhelming, especially when it comes to keeping track of due dates and deciding which loans to pay first. Chances are you'll be using your credit card to pay your existing loans, but this is a bad move since you're incurring debt to pay another debt. Unless you have a solid plan, it's best to avoid credit cards when you have existing loans.
6. Money Personality
Self-awareness is key. Your decision to either say yes or no to a credit card should depend on your knowledge of your money management style. If you're confident with how you handle your finances, by all means, go ahead. If it's the opposite, perhaps you need more time to learn how to manage money matters more efficiently.
You may take BPI AIA's quiz to learn about your money management style.
