There are two things to know about chords: what a chord is and which ones to play. It's the difference between how to make dinner and what to make. Music-theory teachers in Harris-tweed jackets dictate the first. The guitar player in the ratty t-shirt picks the second. (If you're in a New-Englandy contra band, substitute "piano.")
Wait. But isn't there a "right" chord? Wait. But isn't there a "right" meal?
Guitar players have more flexibility than most folks realize. In beginning old-timey workshops, I'll often have the guitar players start out by playing just one chord all the way through -- the chord that names the key. Back up Yankee Doodle with nothing but a G and it'll have quirky moments, but basically turn out okay. If someone questions your chord choice, explain that it's a traditional version you learned off a Smithsonian recording of a sixty-nine-year-old, beet farmer from Finger's Gap, Rhode Island, who told the archivist he learned it from his Great-Uncle Topher.
There are, however, wrong, chords. Audio equivalents of escargot smoothies. To avoid those, let's run through your choices for a second, and winnow out some wrong chords.
There are seven letters: A, B, C, D, E, F, and G. If someone says, "Play an 'M' chord," that's wrong.
I started learning guitar in Spain, and in Spanish they don't even use letters, they use "do, re, me," where "do" means "C." It's like being on a giant set for The Sound of Music. Sing along with Randy Barnes, who sat down next to me on stage one night and taught me,
Dough, I use to buy my beer.
Ray, the guy who pours my beer.
Me, the guy who drinks my beer.
Far, a long way to the john.
So, I think I'll have a beer.
Laaa-ger in a frosty mug.
Tea? No thanks. I'll have a beer.
That all brings us back to
Dough, dough, dough, dough, ...
Except in Spain, they don't say "ti," they say "si."
There are also sharps (#) and flats (b) for most of these, but you'll only use F#, C#, and Bb. If you're playing folk music, people will talk about diminisheds and augmenteds and seven-flat-thirteens, but for contras and squares you'll play mostly majors, once in a while, minors.
If you stop and think, "Should I play a D7 here?" you're wrong.
There are thirteen majors and thirteen minors, but you won't need all of them. Writing "A major" as "A" and "A minor" as "a", you need to know these:
A, a, Bb, b, C, c#, D, d, E, e, F, G
A dozen chords. If you're compulsive, you can learn those in a week and learn them well in three. Even if you're not, it's still easier than cooking or making beer.
If you're hunting for chords and someone says, "Shouldn't there be a b-flat-minor right there?" say, "No."
Even these twelve aren't all equally common. Most tunes are in D, A, or G. Most tunes have three chords, the first, fourth, and fifth -- usually written with Roman numerals as I, IV, and V. What's that leave you needing? For D: D (I), G (IV), and A (V). For A: A (I), D (IV), and E (V). For G: G (I), C (IV), and D (V).
If you're playing in one of these keys, remember that if you're unsure about which one to play, the chord that names the key is a safe fall-back.
However, covering these keys doesn't require learning nine chords (three times three) because there's overlap. Mushing them all together, you're left with A, C, D, E, and G. Five.
Some tunes only have the I and V. A couple only have the I and you can sit there and hammer on a single chord, all tune. Dance music, nuthin' ... it's trance music. To be safe, though, learn all three in all three keys.
Five chords. What would you pay? But wait. There's less.
If you're just learning, go to old-timey jams, because they'll stay in the same key all night. The fiddlers and banjo players like to tune differently for different keys, so once they're cross-tuned to A, it's easiest for them just to stay in A. To play at those jams, you only need three chords.
"But which three?" you're asking yourself. Suppose you've only learned the three chords for the key of A, you get there, and a fiddler says, "Let's play in D." You have to drive all the way home again. So sad. This is yet another reason to start a jam. You can say, "We're having an 'A' jam at my house." Even if there's a coup, and everyone else votes to switch to G, you don't have far to drive.