Cursor Setup — The 10 Settings That Actually Matter
Chapter 2: Cursor Setup — The 10 Settings That Actually Matter
Installing Cursor takes 5 minutes. Configuring it properly is another story. Most tutorials stop at "download, install, log in" — but what determines your productivity are the 10 settings that are off by default, and your first .cursorrules file.
Installation
macOS: Download the .dmg from cursor.com, drag to Applications, done.
Windows: Download the .exe installer and follow the wizard. Cursor is VS Code-based, so existing VS Code users will feel right at home.
Linux: Download the .AppImage, chmod +x and run it, or use the .deb/.rpm package.
On first launch, you'll be prompted to import your VS Code config (extensions, theme, keybindings). Choosing to import lets you migrate at zero cost.
Model Selection: Performance and Cost
| Model | Best For | Speed | Cost |
|---|---|---|---|
| claude-sonnet-4-6 | Complex code, architecture, daily work | Medium | Medium |
| claude-haiku-4-5 | Fast completion, simple Q&A, high frequency | Fast | Low |
| GPT-4o | Comparisons with OpenAI ecosystem | Medium | Medium |
| cursor-small | Minimal tasks, token conservation | Very fast | Very low |
Recommendation: Use claude-sonnet-4-6 for daily work, claude-haiku-4-5 when speed matters, claude-opus occasionally for complex architecture design. You don't need the most expensive model every time.
Privacy Mode
Off by default. Enable at: Settings → General → Privacy Mode.
When enabled: your code is not used for Anthropic/OpenAI model training. If your codebase contains trade secrets, user data, or your company has compliance requirements, this must be on.
Cursor Business ($40/month/user) forces Privacy Mode on and provides centralized management. Teams handling sensitive data should use Business, not Personal with manual Privacy Mode enabled.
10 Key Settings
Open Settings (Cmd/Ctrl+Shift+J):
1. Auto Import Path: Editor → Auto Import When on, AI-generated code automatically includes missing import statements. Strongly recommended.
2. Cursor Tab (Tab Completion) Path: Features → Cursor Tab Tab key accepts inline suggestions. This is Cursor's most basic feature — should be on by default, but verify.
3. Context Files (Indexing size) Path: Features → Codebase Indexing Set "Max files to index" to match your actual project file count. Large projects need this raised (default may only index the first 1,000 files).
4. Rules for AI (Global rules) Path: General → Rules for AI Write global rules that apply to all projects here — e.g., "reply in English," "comments in English."
5. Include/Exclude Files (Index scope)
Controlled via .cursorignore. Exclude node_modules/, dist/, .git/ to avoid wasting index space.
6. Editor Font Size Personal preference, but for long coding sessions 13–14px is recommended.
7. Terminal Keybindings Make sure these match your existing terminal habits to avoid misfires.
8. Vim/Emacs Mode If you're a Vim user, enable Vim mode in Settings — full Vim support is included.
9. Multi-cursor Editing Verify that Alt+Click and Cmd+D multi-cursor shortcuts work as expected.
10. Git Integration With the Source Control sidebar open, you can let AI generate commit messages from diffs — a real time-saver.
Your First .cursorrules File
Create .cursorrules in your project root. This is the ruleset AI follows for this project. A minimal effective .cursorrules:
# Tech Stack
- Language: TypeScript 5, strict: true
- Framework: Next.js 14 App Router
- Database: PostgreSQL + Prisma ORM
- Styling: Tailwind CSS
# Code Standards
- Functional components only, no class components
- State management: Zustand, not Redux
- All async functions must have try/catch
# Naming Conventions
- Component files: PascalCase (UserCard.tsx)
- Utility functions: camelCase (formatDate.ts)
- Constants: UPPER_SNAKE_CASE
# Prohibitions
- No `any` types (add a comment explaining why when exceptions are needed)
- No direct database access in components — go through the API layer
The value of .cursorrules: every time AI generates code, it consults this file. You don't need to repeat "use TypeScript" or "use Prisma" in every prompt — AI already knows.
Chapter Key Points
- Choose models by task: Sonnet for daily work, Haiku for speed, Opus for high-accuracy tasks.
- Privacy Mode is a compliance requirement: Enable it for any codebase touching user data or trade secrets.
- The most important of the 10 settings: Auto Import, Cursor Tab, Rules for AI, and the Codebase Indexing file limit.
- .cursorrules is the first file to create: It gives AI project knowledge from line one.
- Import your VS Code config: Migration is nearly zero-cost — don't configure from scratch.