Those who want to build or recover a credit rating can apply for a credit card, use it to make purchases a few times each month, and make the payments on time. This helps establish a pattern of responsible credit use.
As a person borrows with a credit card and then makes on-time payments, he builds an effective payment history. The key is to build credit without being exposed to the risks of excessive debt. In addition to minimizing the number of cards, a person can ask a creditor to issue a card with a modest limit. This tactic is especially sensible with a young person getting a first credit card.
To build credit effectively with a card, one must avoid the pitfalls that come with access to credit. Borrowing and then missing payments is counteractive to the goal. Late payments hurt a person's credit. Taking on more debt than one can keep up with increases the risks of late payments, delinquency and default. Exceeding the credit limit on a card is also damaging to credit.
A secured credit card is one way to build credit safely. With a secured card, one pays money into the account, which becomes security for payments on the card.