How To Safely Get Back Into Using a Credit Card If You’ve Had a Bad Experience With Debt

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When used responsibly, credit cards are a key ingredient of a healthy financial life. But when misused, revolving debt becomes financial quicksand. 

“Credit cards are a convenient, cash-free way to shop and they also offer a great opportunity to build strong credit,” said Trae Bodge, a shopping expert and founder of “But they can also work against you with high balances, missed payments, etc.” 

Important: Why It’s a Bad Move To Use the Same Credit Cards Indefinitely
See: 4 Credit Cards That Are Great for Day-to-Day Errands

Millions of Americans have fallen into debt this way and many of them are hesitant to ever pick up plastic again. That’s an understandable but self-defeating reaction. The smart move is to get back on the horse — but only after you learn enough to make credit card companies work for you instead of the other way around. 

Start By Learning the Fundamentals

When you use a credit card, either the bank will collect money from you in the form of interest and fees, or you’ll collect money from the bank in the form of points, miles, and cash back. Only one of you can win, and the best way to beat the bank is to take the time to learn the fundamentals of credit cards, including: 

  • How APR is calculated
  • How interest compounds and the trap of the minimum payment
  • When lenders report late payments and how it impacts your credit (it’s bad)
  • The fact that you’ll avoid finance charges by paying your statement balance every month
  • The way that factors like payment history, credit utilization, and credit age affect your borrowing power
  • The impact that applying for credit or closing accounts can have on your credit
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Mastering the basics isn’t hard, but it is beyond the scope of this article. Organizations like the Consumer Financial Protection Bureau — as well as most banks, credit unions, and credit bureaus — offer concise, easy-to-follow tutorials.

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Ease Back Into It and Rebuild Your Credit With a Starter Card

If you’re just emerging from an ugly debt, your credit probably took some damage along the way. Don’t worry — there’s a card for you.

“Sign up for a credit card specifically designed for low-credit score users,” said Jared Beilby, a credit card analyst with MerchantMaverick. “These cards usually come with low credit limits, which means you won’t be able to spend too much without paying off your balance first.”

Aside from built-in spending controls, the best cards for people with shaky credit also tend to include credit-building features like incremental credit-limit increases. 

“There are also other options such as applying for a secured card, which uses your own money as collateral when you put down a deposit with the bank,” said Lisa Fischer, chief lending and growth officer at Mission Lane, a financial services company for people with poor credit. 

Fischer cited her company’s own Visa card, which is designed to rebuild credit, but other good options include the Discover it Secured card and Capital One Platinum Secured.

Check Out: 90-Second Moves To Raise Your Credit Score 200 Points

Challenge the Way You Look at Credit

Credit is not someone else’s money and it’s not a way to buy things that you can’t afford. If that’s the mindset, you’re doomed to end up right back where you started — stuck in debt. 

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“If you’re out of practice using a credit card, it’s a good time to approach credit card usage differently,” said Bodge. “Rather than looking at your credit card as free money or using it to purchase items that are beyond your budget, use it only for things that can be paid off in full that month.”

The single best thing you can do — other than to never miss a payment — is to pay for your purchases right away so there’s no risk of carrying a balance and incurring interest charges.

“Treat your credit card like a debit card,” said John Eringman, a personal finance educator known as Johnefinance on Tiktok and Instagram, where he has more than 1.2 million combined followers. “Every time you make a purchase using your credit card, go into the app and make a payment. This will get you into the habit of always paying off your credit card and not spending more than you can afford.”

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Last updated: Oct. 4, 2021


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