How to build credit w/ mystery shopping?

Does anyone have some helpful tips? I am 25 and have never had a credit card. Honestly, I don’t even know what to look for, how to sign up, how to pick a card/company, and am nervous about hidden fees and what not. My credit score is fairly low (all I have is a car payment, so nothing to help build it), and I’ve seen much talk around here about using cards to rack up points/credit/perks.

I have good self control & am not worried about racking up a bill I can’t pay off month to month. Rather than use my PayPal debit card though, I’m thinking I could be using a credit card instead and “getting something out of it” if that makes sense.

I would appreciate any advice!

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For unsecured cards, credit unions are very lenient for first timers. Discover is another provider that’s also lenient. If worst comes to worst, secured cards where you place a security deposit to fund the card is another good option. What is your understanding to credit cards and how they work?

Shopping the Greater Denver Area, Colorado Springs and in-between in Colorado. 28 year old male and willing to travel! Badged for Denver International Airport.
My understanding is that you apply for a line of credit through whichever company. They look at your (credit score?) to determine the amount they will allow. You use your card and as you pay your bill on time each month, your credit score increases and along with that, companies are also willing to offer you higher $ limits.

I understand you are charged interest when you don’t pay your bill off each month (and it can be high, like 25% or something depending on the card).
I'm 22 and recently got my first credit card so I know exactly what you mean! Here are some things I was told about or kept in mind when I applied for my first one-

It's easier to get a card if you have a financial relationship with an institution; I've been using the same credit union since I was a kid so I applied there. I actually had to call and check on my application because it was rejected twice. However, I had literally no credit history at the time and they just needed to verify my identity.

What you want to look for is a low interest rate. I have also heard it can be helpful as well as if the card as a period of time with no interest at all - I have heard conflicting advice about carrying a balance during this time to up the score (DEFINITELY not sure of the merit or value in this, can anyone confirm/deny?), but you should also keep in mind that credit usage is a factor in your score. For example, if you have a card with a $1500 limit and you are using $1300 of it every month, the bank may see you as a risk and not want to up your credit limit.

Look for a card without fees and definitely read the fine print on anything before you sign. I highly recommend going to your local bank or credit union and asking to meet with a banker to discuss credit options; they can often help you narrow down what you should apply for and would be able to get.

Now, many mystery shoppers seem to apply for high rewards cards (ie spend $xxxx in the first y months and get z cash as a reward), but be careful that those cards don't end up costing you in fees later. You can close the credit card, but you don't want to be opening and closing lines of credit as I've heard that can have a negative effect on your score. The Mint app can recommend offers with cash back.

FINALLY: definitely keep an eye on your score and reports - you might already know that you can get a free report 1x per year from each of 3 institutions that gives a score, but apps or websites like Mint and Wells Fargo online banking can give you an updated score every month and send you an alert when they have it. Read your entire statement every month to catch any fraud or mistakes.

TLDR: Read the fine print. Don't use all of your credit every month. Speak with a banker for expert advice. Apply at an institution you have a relationship with. Check your score and statements often. Get a low interest rate, avoid fees, and look for $ rewards for spending a certain amount. Also I'm only 22 and tried to note where I wasn't sure of info so you can do more research or others can chime in.

I hope more shoppers share their experiences with using rewards cards and what they look for!!
Building (not rebuilding) credit, you want to get a card from a bank or credit union (preferable) that you have an existing relationship with. I would concern myself with building a solid credit history before worrying about finding cards with bonuses and rewards. Those will come in time. Avoid any cards with fees. Interest should only matter if you don’t pay the balance off on time each month.
When you do get a card, start by only using it for expenses you routinely pay every month. Such as your cell phone or cable bill. You say you have good self-control now, but you also don’t have a credit card trying to burn a hole in your pocket. While you’re getting used to resist the urge to charge, establish a monthly budget amount for how much you can comfortably pay. Set that amount aside and don’t touch it. When you stop feeling the urge to splurge, go ahead and start using your card for other routine expenses such as gas and groceries. Keep your purchases within your budget. Your credit score will increase over time, and after a few years, you may become eligible for cards with higher limits and better rewards.

My advice is more cautious than most, and the reason is it’s what I SHOULD have done. Building good credit is much easier than trying to rebuild.

In regards to mystery shopping, yes, having a credit card can help you with some shops. However, do not count on getting the reimbursement before the bill is due. The credit provider will not care your payment is late.

Here is a good forum about credit that you might want to read and ask questions.
[ficoforums.myfico.com]
OP
First off you may have a higher score than you think if you have a car payment and have kept up and never missed a payment. Second you should look for a credit card with a good cash back especially if you plan to pay off the balance each month.
I would charge all you reimbursement expenses with mystery shopping and then pay the card off each month.I would not use the card otherwise. I would suggest either Capital One Silver as they are great for people with limited credit history and it offers 1.5 % cash back. Otherwise Chase has some good cashback cards. In a year or so after you get your first card get a 2nd card with a low interest rate. Your score is based on a number of factors but the main portion is credit used to available credit and that you are making payments on time and not having late or missed payments.
On a side note I would suggest using credit as little as possible and just save up and pay cash for anything you may want or need like cars and someday a house. It has been the banking industry that has destroyed these country on the lie of credit. It is almost impossible to make it nowadays without credit which is why you need to establish it but it doesn't mean you have to use it.

Shopping Western NY, Northeast and Central PA, and parts of Ohio and West Virginia. Have car will travel anywhere if the monies right.
@MadisonDiem wrote:

I have heard conflicting advice about carrying a balance during this time to up the score (DEFINITELY not sure of the merit or value in this, can anyone confirm/deny?), but you should also keep in mind that credit usage is a factor in your score. For example, if you have a card with a $1500 limit and you are using $1300 of it every month, the bank may see you as a risk and not want to up your credit limit.

That’s called credit utilization. Many consumers believe the balance showing on their monthly statement is the balance reported to the credit bureaus. Not necessarily. You would need to contact your credit providers to find out what their reporting date actually is.

Low utilization, <9% of the credit limit, is generally considered positive. However, it’s not going to significantly help you increase your score when you are still new to credit. Not nearly as much as paying on time and staying below your limit will. Build those habits first before you worry about maintaining utilization.

@MadisonDiem wrote:

Now, many mystery shoppers seem to apply for high rewards cards (ie spend $xxxx in the first y months and get z cash as a reward), but be careful that those cards don't end up costing you in fees later.

Remember that many of those mystery shoppers have decades of good credit history and have earned credit scores well above 700. The amount of money you may have to spend to earn those rewards could easily require you to carry a balance if your income isn’t high enough yet. The interest from that could eat any bonus you receive.

In short, if you’re new to credit, don’t worry about rewards and bonuses. Just focus on paying the bill on time and in full. Do that and the rewards will come.
As a mom, I'd agree with everything Troy Hawkins said.

My 18 year old got a Mastercard with $1000 limit (Unsecured) right away with the bank he has used since he was 12 years old.

The only thing that I have to add is: AUTOPAY. Pay it off in full every month automatically. You don't want to be late, ever.
@TroyHawkins wrote:

Remember that many of those mystery shoppers have decades of good credit history and have earned credit scores well above 700. The amount of money you may have to spend to earn those rewards could easily require you to carry a balance if your income isn’t high enough yet. The interest from that could eat any bonus you receive.

In short, if you’re new to credit, don’t worry about rewards and bonuses. Just focus on paying the bill on time and in full. Do that and the rewards will come.

Thanks so much for your thoughts! Can you clarify the bolded statement? Are you saying if I can't afford to spend the amount needed to earn the bonus (and pay it off each month as I get to the reward) I should not do it because I would then incur interest which would affect the profit margin? That makes total sense of course, but I want to make sure that's what you meant.

Edit: a few questions of my own..

How does one ask their bank to up their credit limit? I use mine for all my charges but never spend more than what I have in cold hard cash, so a higher limit should allow me to use a lower percentage.

@BuffaloNY101 wrote:

In a year or so after you get your first card get a 2nd card with a low interest rate.

Is this an arbitrary timeline, how long it might take to get your credit score high enough to score a better interest rate, or for another reason? I ask because I got my card about 8 months ago and was thinking of looking for a rewards card soon since I am happy with my credit habits and my score is 'good.'

Edited 1 time(s). Last edit at 06/05/2018 06:15PM by MadisonDiem.
I like the suggestion to talk to a banker, and you could even do so on mystery shops. Many credit cards offered through banks have rewards. My bank card offers rewards on everything and higher rewards for cell phone and utility bills. It's a no-brainer to use it for payments I'm making monthly anyway.

Instead of carrying the card with you, it can be kept in a drawer at home. I've heard it helps some people because they have to make a conscious effort to go get the card before making a purchase.

Equal rights for others does not mean fewer rights for you. It's not pie.
"I prefer someone who burns the flag and then wraps themselves up in the Constitution over someone who burns the Constitution and then wraps themselves up in the flag." -Molly Ivins
Never try to teach a pig to sing. It's a waste of your time and it really annoys the pig.
@BuffaloNY101 wrote:

In a year or so after you get your first card get a 2nd card with a low interest rate.

Is this an arbitrary timeline, how long it might take to get your credit score high enough to score a better interest rate, or for another reason? I ask because I got my card about 8 months ago and was thinking of looking for a rewards card soon since I am happy with my credit habits and my score is 'good.'[/quote]

My response

I was just using it as a general guideline as a good amount of time to prove your a credit worthy person who can handle credit and also for time to get your score up. If your in the low 700's or higher than a rewards card is what you may want. Just do a search for best rewards cards or go to thepointsguy.com site as it is a really useful site. CreditKarma will let you get your score and report free anytime.

Shopping Western NY, Northeast and Central PA, and parts of Ohio and West Virginia. Have car will travel anywhere if the monies right.


Edited 1 time(s). Last edit at 06/05/2018 06:51PM by BuffaloNY101.
If your card doesn't offer rewards, it makes sense to move on to another. If a lower interest rate is all you want, get in the habit of asking. If you have been handling the credit responsibly, a phone call can result in lowered interest rates, raised credit limits and/or being moved into a rewards program. People tend to avoid contacting credit card companies because they seem afraid of the answer. The worst thing they can say is, "No."

Equal rights for others does not mean fewer rights for you. It's not pie.
"I prefer someone who burns the flag and then wraps themselves up in the Constitution over someone who burns the Constitution and then wraps themselves up in the flag." -Molly Ivins
Never try to teach a pig to sing. It's a waste of your time and it really annoys the pig.
@JennyFromTheShop wrote:

@TroyHawkins wrote:

The amount of money you may have to spend to earn those rewards could easily require you to carry a balance if your income isn’t high enough yet. The interest from that could eat any bonus you receive.

Thanks so much for your thoughts! Can you clarify the bolded statement?

Let’s say you can afford a max payment of $1,000 a month and a card offers a bonus of $300 after 3 months provided you charge at least $5,000. In order to meet that requirement, you have to carry a balance, on which you will be charged interest. Because you don’t have the ability to pay it in full each month and meet the minimum requirements in 3 months. The total interest you end up paying may not equal the bonus, but it can easily cut it down to $200 or $100.

Basically, read the terms and conditions and evaluate if you will be able to meet the requirements.

There are a lot of possible scenarios that might work out in your favor, especially if you can charge large expenses like rent, car payments or insurance. Just have a plan first, before you get the card.
@TroyHawkins wrote:

Remember that many of those mystery shoppers have decades of good credit history and have earned credit scores well above 700. The amount of money you may have to spend to earn those rewards could easily require you to carry a balance if your income isn’t high enough yet. The interest from that could eat any bonus you receive.

"Decades" of credit history is a bit of an exaggeration. I've been churning cards since my early 20's.

Shopping the Greater Denver Area, Colorado Springs and in-between in Colorado. 28 year old male and willing to travel! Badged for Denver International Airport.


Edited 1 time(s). Last edit at 06/05/2018 09:05PM by Tarantado.
There are plenty of cards out there that have good intro offers --$150 cash back for spending only $500 in the first 90 days if you can qualify for one of those.
@Tarantado wrote:


"Decades" of credit history is a bit of an exaggeration. I've been churning cards since my early 20's.

You mean back when it was easy for a 20-something to get credit?

I’m not trying to scare anyone off of getting credit. Just trying to reinforce how important it is to manage credit wisely.
@TroyHawkins wrote:

You mean back when it was easy for a 20-something to get credit?

I’m not trying to scare anyone off of getting credit. Just trying to reinforce how important it is to manage credit wisely.
2012 isn't that long ago....

But yes, financial education is very important to understand how to use and manager credit cards.

Shopping the Greater Denver Area, Colorado Springs and in-between in Colorado. 28 year old male and willing to travel! Badged for Denver International Airport.
Sign up for Credit Karma. It is free and will give your credit scores for Transunion and Equifax. If there is a change they notify you right away. They also suggest credit cards that you may be able to obtain depending on your credit. It has helped me a lot. Just keep your payments on time and keep the available credit below 20 percent. Good luck - it should not be too hard.
I would read Credit Karma's fine print first (hint: spam and "estimated" score). Pay for the actual score or apply for a Discover card and get it every month for free.

Seriously, nobody cares that you're offended.
My daughter got her first credit card through our credit union. She asked for a credit limit of $500 with very good interest. Something in the neighborhood of 7%. She asked for a higher credit limit like $1,000. Still got a low interest rate. I asked her if she can get a cash back credit credit since she has to take Amtrak to and from work. I figured if she pays about $200 for a monthly pass, she should get a cash back credit card which offered a higher interest something like 9 or 11%. That would be like getting an one month's Amtrak $200 pass for free after 1 year. She budgets the $200 already so that would be paid off each month.
I second the opinion of all who suggest getting your first card through the institution you bank with. If that's a credit union, or if you can join a credit union, I highly recommend that! My 21-year-old son got his card through our credit union after opening his own accounts once he got his first job. My husband had to co-sign for it, but at this point, the kid probably has better credit than we do! He's set up auto-pay at more than his minimum payment, so it will be paid off much sooner than if he were paying minimum (which is never a good idea). He got the card initially to buy a new computer with, and aside from a situation he had when his debit card was hacked, he doesn't use it. But he's still building credit. The thing about credit unions is that their interest rates are way lower than commercial rates. We have a CC through our credit union, too, and I think the IR is around 10 points (or more) lower than the other cards we have.

I learn something new every day, but not everyday!
I've learned to never trust spell-check or my phone's auto-fill feature.
I have had recent experience with my son trying to get a credit card. He is in his twenties with a six figure salary and no dings at all to his credit. He has been earning this income for over 5 years and has substantial savings. Obviously he is not a full time mystery shopper! He could not get a non secured card because he moved a few times (as those in their twenties often do) and he often lived with room mates who had the bills in their names so not much history there. He has savings accounts and none of that helped. He finally decided to go the secured card route for a year and paid a small fee.The cards he found had no cash back or bonuses. So I am surprised to read these stories of young people with no credit history walking into their bank and getting credit.
But then I discovered I could put him on my card and he would thereby build up a credit history based on my handling the card correctly. If you have parents that trust you and have good habits themselves they might agree to add you to their card. You would get your own card on their account or they could just hold it for you while you build up a history on the back of their account. After six months or so he started to get offers of his own card. He always got these offers but before we did this none of the mail offers panned out. Even if he never used the card himself his credit rating would have gone up because I was using it.
The key to building credit is to use the card lightly and paying it off whatever type of card you end up with. They recommend only charging 1/3 your credit limit each month so if your limit is $6,000 that would mean $2,000 would be your max. You should use it but it is very important to pay it off each month and on time. The advice to keep it in a drawer at home if you cannot resist using it is great. I would recommend you use your first card to the 1/3 credit limit max each month and then switch to your debit card for the rest of the month so you do not fall into the trap of "oh just this once because i really need this thing." Those bonuses for opening cards are very attractive but only if you have the money to pay off right away the full amt you had to charge to get the bonus.
Capitol One Bank has some very good free classes if there is a branch/cafe near you. It is possible they have the information online on their website too. Take a look and they will educate you about credit limits, budgeting, goal setting and all sorts of good financial and life issues.
@sandyf wrote:

I have had recent experience with my son trying to get a credit card. He is in his twenties with a six figure salary and no dings at all to his credit. He has been earning this income for over 5 years and has substantial savings. Obviously he is not a full time mystery shopper! He could not get a non secured card because he moved a few times (as those in their twenties often do) and he often lived with room mates who had the bills in their names so not much history there. He has savings accounts and none of that helped. He finally decided to go the secured card route for a year and paid a small fee.The cards he found had no cash back or bonuses. So I am surprised to read these stories of young people with no credit history walking into their bank and getting credit.
Not sure how much the landscape's changed this past decade.... But my own bank at 18 years old (FirstBank) denied me for an unsecured credit card back in late 2008. That same month, I applied with the Credit Union of Denver on my school campus and was instantly approved for an unsecured credit card with 1% rewards with a $200 limit. In 2009, I expanded my library of credit cards with Wells Fargo for a $500 limit and Discover IT for a $2,000 limit. On my end, I had absolutely no credit during that time, then again, no student loans or any debts. I had a clean slate and though one bank denied me, the credit union gave me a chance, granted it was only rather small credit limits. I believe I hit the 800's with my credit score by the time I was 21 or 22; by that time, I was able to apply for any credit cards, mortgages, etc. and be approved with flying colors, unless of course, you're Chase and have those ridiculous limitations aka the 5/24 rule.

Shopping the Greater Denver Area, Colorado Springs and in-between in Colorado. 28 year old male and willing to travel! Badged for Denver International Airport.
@sandyf wrote:

I discovered I could put him on my card and he would thereby build up a credit history based on my handling the card correctly.
^^This^^ We've had them as authorized users since they were teens.

I'm not entirely certain about the algorithms used for credit score. Mine is great. One of my son's is even better -- even though he has never held a job, just graduated from college, and has substantial student loans.

Seriously, nobody cares that you're offended.
@iShop123 wrote:

@sandyf wrote:

I discovered I could put him on my card and he would thereby build up a credit history based on my handling the card correctly.
^^This^^ We've had them as authorized users since they were teens.

I'm not entirely certain about the algorithms used for credit score. Mine is great. One of my son's is even better
-- even though he has never held a job, just graduated from college, and has substantial student loans.

Every card might work differently but my card (American Express) told me that even if he never used his personal card he would get credit for how I paid the bill such as on time, in full, monthly bill being a small percentage of what is allowed and all those other things they say you need to do. His credit score did go up regularly after he was on my card. He was using it a lot more than I was though.
A lot of this is very good information. One thing I think is different however: if you are paying off your credit card every month, it's fine to almost max it out. However, if you are running a balance (that you are not paying off at month-end) and your balance is almost at limit, the credit card company may lower your limit. If you do run a balance, keep it under 30% of your limit (now if I just practiced what I preach!!!)
There is no way I could pay off my cards every month if I maxed them out, wow!

Edited for typing on my phone...

Edited 1 time(s). Last edit at 06/13/2018 03:24AM by JASFLALMT.
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