Most of the population has or will have had a credit card. Most people will get a credit card in times of need or to purchase outside of their normal budget. Credit cards can be essential throughout life and not only help when you are financially uncertain but can give you a bonus and, in many cases, some discounts.
Many people apply for and get their first credit card as young as possible. But when is this? At what age and earning potential can you apply for and get your first credit card? Is having a credit card younger a good idea, or are you better off waiting a while?
We will specifically in this article be discussing credit card companies and applying for a credit card. However, the rules will be similar when applying for a loan. It is always best to check with your bank and your finances before applying for any form of credit, regardless of your age or current circumstances.
Legal Age
In Norway, the legal age limit for applying for credit is 18; however, this is credit card company dependent. Although when you are 18 there are credit card and loan companies who will look at your application and even in many cases approve this, there are others who would not.
Turning 18 can often feel like the age where you can do anything. You can now drink beer, you can open a bank account, change your name, and even vote. Having all of these new things open to you can make you feel like you need to do everything just to prove to yourself you can. This is why many people at 18 will apply for a credit card.
If you have just turned 18 and you are looking at what credit card companies you could apply to, you can look at the kredittkort info on the company’s home page. On the home page of the credit card company, you will find information on how old you need to be and the earnings you will need to be getting either monthly or annually to pay off the credit card.
Some companies will not offer credit cards to people until they are aged 25 and older. This is why it is advised to always look at any limitations or restrictions when applying for a credit card or loan.
Younger
What we mean by younger is getting your credit card at the earliest possible time. Whether this is when you are just leaving school and stepping out into the big wide world or when you are continuing in further education and require a little more financial support than you realized. There are positives to getting yourself a credit card or opening some line of credit at a young age, but there are also negatives.
Firstly we will discuss some positives, these can include being able to build your credit score from a young age. Your credit card will start with a small limit as the company tries to work out if you are a good financial risk. You will get offers to make your limit bigger if all goes well.
However, to start the company will not know if you can be financially responsible, more so if you are only in your late teens or early 20s. This does also mean that so long as you can meet the requirements for income and age you are likely to be approved because you will not have had time to make a negative impact on your credit score.
To get a credit card you will need to have some kind of income, whether this is from a part-time job or from money you get funded for studying in further education. You must be able to make at least a minimum payment, and you will need to give this information to your credit card company.
Being able to get approved for a credit score relatively easily can be beneficial and is more likely when you are younger and have only just started being able to impact your credit score. Having a credit card and managing it well will also positively affect your credit score making it more likely that you will be approved for a larger credit card or a loan if you need it.
Some people will argue that the earlier you get a credit card, the less responsible you will be with the money you have access to. To avoid this only get a credit card to make one large purchase or to make a smaller purchase that you can pay off monthly.
There is the risk with a credit card when you are young to ramp up to the limit and pay back your monthly repayments, this could lead to persistent debt and can work against you by negatively affecting your credit score. It can be tempting when young to get a credit card and feel like you do not need to worry about it and pay it off when you can, this is why some people will advise against getting a credit card when young.
Middle Aged
By middle-aged, we mean someone in their 40s and up to retirement age. This is the age when you are most likely to be working a full-time job and have a family to support. At this age, you may need money for making larger purchases or making repairs to your home or car. Because you can apply for a credit card at 18 or 25, in many cases, you are likely to have a credit card at this age already.
This can be the age where you feel the most need to have a credit card as a fallback in case something goes wrong. Whether you want to have discounts and cashback offers that a lot of credit card companies offer to help you with your day-to-day spending. Or you want to have a credit card to help when you need to make bigger purchases or to cover any issues you could have to keep your car on the road.
When you are older and with a family or alone, there are more things you could need extra cash for. This is when having your credit card could help most. You are also more likely to be working and able to make repayments and manage your finances.
This is why a lot of companies will be less likely to refuse you a credit card unless you have previously negatively affected your credit score. Even in this situation, you may be able to get a small credit card, which would help to improve your credit score and help in situations where you are struggling.
If you do not you can apply so long as you can meet all other requirements for the credit card company. However, unlike when you are young you can look at what your limits would be and how much you would like to have available. Due to having a regular income and a job you will be able to pick how much you would like to be able to have on your credit card and how much you can afford to pay back.
Older
Once you get to retirement age if you are not working you are unlikely to be approved for larger limited credit cards. Some credit cards may not offer credit to someone who is older as they may have upper age limits. In this instance, you will need to look at the kredittkort info to see if this would affect you.
You are still likely to be able to get a credit card so long as you have a regular income, a good credit score, and can meet repayments. When older, the benefits you can get from having and using a credit card would be more valuable than they may be to a younger person. For example, having protection for your money from fraud and being able to have travel insurance when paying for your trip on your card can mean you can safely travel to see your family knowing you have travel insurance and will be safe.
You may also want to live a life without debt when you are older. Having used a credit card throughout your life you may choose to no longer need the fallback. Or you may want to keep a small credit card around on the off chance something happens and you need that safety net. There is no right or wrong reason to need a credit card so long as you can meet the requirements of the company need.
Summary
Although there is no right or wrong time to take out a credit card, all companies will have their limits. For most, this is the legal age for many places, including Norway, which is 18 years old. However, some companies will want their customers to be older. This is to try and avoid people getting a credit card too young, negatively impacting their credit score, and starting their adult lives with debt.
A credit card can be the best thing to not only help save and manage your money but to build your credit score too. Getting one young is more likely, however, due to age and maturity this may not be for everyone. Look at any relevant information and limitations before applying to give yourself the best chance of approval.