Nope you arent doing anything wrong. For some reason you need to have a time card on hand, or subscribe with a credit card to redeem that first free month.
I was in the same boat as you, and when i bought it they didnt sell timecards in my town...
Once you put in a timecard code or pay for a month, you will redeem that free month the game comes with.
One other heads up though, the game is going free to play soon. So you might want to consider waiting.