For a 5x7 card you should use the rectangle tool to set your Illustrator work space at 5x7.
Then create a second rectangle slightly larger than the first - by about 0.25 of an inch all round. This will be the cutting line.
Finally, Click on the second line, and go to View/Guides/Make Guides. Now Create another line. This one is a bleeding line, extending the background color all the way to the edges of your card. Set it bigger than your cutting line by about 0.25 inches so that it serves as another guide.
Make sure that you keep all of your card's graphic content inside the first rectangle.
Once you've finished, try printing a test copy. You can play about with paper sizes and print options later - just print to A4 paper to start with.