Learn from My Credit Building Mistakes


It was June 2017, I just turned 18 years old a few days before the month started and I was about to graduate high school. The day I turned 18, I opened a brokerage account, opened my own checking account without parental permission, and tried applying for credit cards. Everything was successful until I tried to apply for a credit card. I got a letter in the mail saying, “We cannot verify your identity,”

This was where I made my first mistake. In order to obtain a credit card, you needed to be a real person (i.e. have a drivers license, state ID, or drivers learners permit). Now, I have an unneeded inquiry on my credit report.

Fast Forward to June 2018

I was too afraid to start driving and never needed the ability to drive since I live in a city that’s accessible by walking and public transit. I finally came to my senses and applied for a learners permit. I waited a few days to apply for a card but this where I made my second mistake. I applied too early before the state could put my information out into public records. This is where I have a second unneeded inquiry on my credit report. I decided to wait two months before applying, though one month could’ve been just fine. I just wanted to be safe.

Newly Acquired Card, Another Mistake?

I applied for the Capital One Platinum Secured Credit Card. It has a $0 annual fee and high interest. I was never worried about interest as I’m responsible and pay off my bill every month but I was interested in a $0 annual fee so I could keep this card on my record as a “record builder” card without having to pay an annual fee for the rest of my life.

The card sounds good right? Well, I should’ve made a larger deposit. I only made a deposit of $50 and had a credit limit of $200 which wasn’t great for my lifestyle and made “credit utilization” terrible. The $200 limit also looked terrible on my report as a $200 limit is reported to other lenders.

Since I had a clean, zero-history credit report, I should’ve applied for the Discover it® Student Cash Back card with $20 statement credit contingent on a 3.0 GPA. Not only is the starting credit limit $500-$1000, you also get cash back and $20 every year as long as you keep a 3.0 GPA. This card is also very easy to get approved for if you’re a student.

Applying for the American Express Blue Cash Everyday® Card

This was a mistake that you should never make. Never apply for a card within’ 6 months of acquiring your first credit card. Lenders look at your report and feel that your age of accounts is way too short before they can approve you for another card. This adds another unneeded inquiry onto your credit report for no reason, whatsoever.

What’s the tl;dr?

  • Make sure you have a drivers license, state ID, or learners permit before you apply for a credit card.

  • Make sure your information has propagated public records if you just applied for a drivers license, state ID, or learners permit.

  • Apply for a student card like the Discover it or Capital One Journey card before resorting to a secured credit card.

  • Don’t apply for another card within’ 6 months of receiving your first credit card. I would recommend waiting to apply for high-wealth cards such as the American Express Blue Cash Everyday after a year and for standard cards such as the PayPal Credit or Discover cards after 7 months have passed.