Matadon

Mind providing a source for this? Your FICO score is partially based on the amount of revolving credit you have available already, because any potential creditor is going to want to know how much debt you can get yourself into, on top of what they grant you. Why does this matter?

Let's say you want to get a mortgage for $300,000, and pull in about $75,000 a year. If you have a good credit rating (e.g., no bankruptcy, a few years at the job, regular payments, etc.), and a couple of credit cards totalling a $5K limit, then you stand a good chance at getting the loan, because the deepest 'in the hole' you can get is $305,000. Now, let's say you have more than a couple of credit cards, plus a bank line of credit, and as such have access to $50,000 in revolving credit. This means you can now sink yourself a hell of a lot deeper in debt after taking out that mortgage, and your lender can do nothing but watch.

In addition, unused accounts can be targets for theft and fraud; best to just close them. If you don't want such a high limit on a card, but want to keep the account, you can just call your credit card provider and ask them to lower the limit -- this is a common tactic when shopping around for mortgages.

Personally, I keep two cards, an AMEX Blue and a Visa. I use the AMEX for any large and/or online purchases (because their customer service is top-notch), and the Visa for small stuff in-town (because their customer service is NOT top-notch).

My recommendation, since you asked for 'what card to get', is to apply for an AMEX Blue. They don't require a huge income ($21K for a base, IIRC), and there are a lot of member benefits, they're great if you travel internationally, and it's the only card you can use at a CostCo. I've had nothing but a good experience with AMEX, and they have stood up for me on a lot of disputed charges, including once when a bartender charged me $40 for a single pint of Fosters. That's what I call service!

Whatever card you get, PAY THE BALANCE EVERY MONTH! DO NOT CARRY A BALANCE AT ALL! The companies make money whenever you purchase something with the card, and there is no good reason to give them any of your hard-earned cash in the form of interest. If you want something, save up, put it on the card when you've got the cash, and pay off the bill when it comes. Your advantage over cash comes in the form of frequent flyer miles and purchase protection (insurance, fraud protection, etc.), NOT in the ability to pay things off over the course of a year.

Emergencies, well, that's different, but that's why you keep some spare change tucked in your savings account. If you work full-time, I recommend six months' pay in savings; if you work part time, try to save up three to six months' worth of expenses. It seems wasteful to have all that cash there when you want to buy that new big-screen TV, but it sure comes in handy when the mafia blows up your car, you lose your job, or your cat gets sick and you have to pay the vetrinary bill.