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Best Credit Cards for Beginners of September 2021
Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through a credit card issuer partnership.
When it comes to building credit, the earlier the better — and choosing the right starter credit card will help you establish a good credit score. Credit cards for beginners often have few bells and whistles, but when used responsibly, you can upgrade to a better card down the line.
Deciding which starter credit card is the best fit for you can be challenging. Since everyone has a different credit profile and different spending habits, there isn’t a single “best” beginner credit card. However, with various options to choose from, there’s something for everyone.
Based on our research of cards available through LendingTree, as well as top cards offered by major issuers, we put together a list of top cards for someone new to credit.
Know your credit score
Before you choose a card, you need to ask yourself a few questions that can help narrow down your choices — the first of which is to know “what is my credit score?” or “do I even have one?”
By knowing where you stand, you’ll have a better idea of which cards you may qualify for. If you have a bank account, credit card or loan through American Express, Bank of America, Barclays, Chase, Citibank, Discover, PNC Bank or Wells Fargo, for example, you should be able to access your credit score through their online portal. Here is a list of financial institutions that belong to the FICO Score Open Access Program.
You can also check your score for free by just answering a few questions to confirm your identity through My LendingTree. And at Discover.com, you can access your FICO Score for free online with Discover Scorecard, even if you aren’t a Discover customer.
Even if you’ve never had a credit card before, you can still have a credit history if you have had other credit products, such as student or car loans.
However, if you don’t have a credit score, that doesn’t mean you can’t qualify for a credit card. Secured cards are great starter cards that can help you build a credit history from scratch. They require a deposit, often starting at $200, which serves as your credit line, and once your scores improve from responsible usage, you may be able to apply for an unsecured card.
If you’re a student, there are student cards made just for you — and some may even reward you for maintaining good grades.
Are you ready to take on the responsibility of credit?
Know that you need to be at least 18 years old and have a steady source of income to list on the card application to be approved for a credit card. Once approved, you’ll need to work on building up a solid credit score. Here are the most important things you should do:
- Don’t max out your credit limit. That means if you’re given a $500 credit limit, don’t charge more than 30% ($150) to your card in any given month.
- Pay on time every time. Late payments will really knock down your credit score and stay on your credit reports for up to seven years, but their impact will fade over time with responsible usage. If you have difficulty keeping track of payment due dates, set up autopay either through your bank or your card’s online account.
- Avoid carrying a balance. To avoid racking up debt, charge only what you know you’ll be able to pay off when the bill comes due. If your balance becomes too big to pay off, stop using the card until you have your debt paid off.
Best secured cards for no credit history
A secured card is a good place to start if you’re just beginning your credit journey. It can provide you the basis to establish a solid credit history. They can be used just like unsecured cards — the only difference is that you’re required to make a security deposit that will serve as your credit line. This deposit is refundable if you pay off your balance in full and close your account or if you’re upgraded to an unsecured card.
Here are two top secured cards for those new to credit.
Discover it® Secured Credit Card
The Discover it® Secured Credit Card is an all-around great secured card with rewards, a $0 annual fee and typical $200 security deposit. It’s rare to find a secured card with a rewards program, but this card provides 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter, 1% unlimited cash back on all other purchases - automatically. After your account has been open for eight months, Discover will automatically begin reviewing your account to see if you qualify for an unsecured card. If approved, you can receive your deposit back minus any fees or balance owed.
Capital One Platinum Secured Credit Card
If you’d like to see if you can qualify for a secured card that may require a smaller security deposit, the Capital One Platinum Secured Credit Card provides the chance to qualify for a lower $49 or $99 deposit. Just know, there’s no guarantee you’ll qualify for a lower deposit, in which case you’ll need to fork over $200. Regardless of the required minimum deposit, you’ll receive a $200 credit limit. This card doesn’t offer rewards, but does have a $0 annual fee and allows you to receive a higher credit limit after you make your first five monthly payments on time.
Best credit cards for fair credit
If you have “fair” credit (those whose FICO scores are between 580 and 669, according to credit bureau Experian), it can be hard to find cards that aren’t laden with high fees. However, there are some options from major banks, including Capital One, that offer reasonable fees and rewards. When used responsibly, these cards can help you improve your credit, so you can qualify for credit cards for good credit.
Capital One QuicksilverOne Cash Rewards Credit Card
If you have average/fair/limited credit and want to earn rewards, the Capital One QuicksilverOne Cash Rewards Credit Card is a good choice. Cardholders earn 1.5% cash back on every purchase, every day. There is a $39 annual fee, but you can recoup it in cash back if you spend $2,600 a year on the card.
The card comes with a high APR of 26.99% (variable), so this isn’t a card you’ll want to carry a balance on from month to month. Once approved for the card, Capital One will consider your account for a higher credit line in as little as six months.
Finally, you can redeem any cash back you earn with the card for any amount at any time.
Capital One Platinum Credit Card
The Capital One Platinum Credit Card is a no-frills card for those with average/fair/limited credit that doesn’t offer any rewards, but does have a annual fee.
If you use this card responsibly to build credit, after several months you should see improvements in your credit score and may be able to qualify for no-annual-fee rewards cards. In addition, like the Capital One QuicksilverOne Cash Rewards Credit Card, your Capital One Platinum Credit Card account may be considered for a higher credit limit in as little as six months.
Capital One also has a prequalification tool that narrows down which card offers you may qualify for. Knowing whether you have a good chance of being approved for a card can save you from the hassle of applying and then being rejected.
Best student cards
Building a healthy credit score while still in college is key to setting yourself up for future financial success. If you use a credit card responsibly as a student, you can build a good credit score that will help you down the line when trying to get an auto loan, mortgage, cellphone or apartment lease approval.
Below, we highlight two popular student cards:
Discover it® Student Cash Back
Discover it® Student chrome
The Discover it® Student Cash Back and the Discover it® Student chrome both have $0 annual fees and cashback programs, and offer students the chance to earn a $20 statement credit each school year they maintain a 3.0 or higher GPA for up to five consecutive years.
Here are the cashback programs:
Discover it® Student Cash Back: 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate, 1% unlimited cash back on all other purchases - automatically.
Discover it® Student chrome: 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter, 1% unlimited cash back on all other purchases - automatically.
Not ready for your own card? Become an authorized user
Credit cards have a lot of moving pieces to deal with, from annual fees and interest rates to payment due dates and credit limits. As the primary cardholder, you’re responsible for all this and more. It can be worthwhile, but if you’re not ready to take on the liability for your own credit card, consider asking a family member to add you as an authorized user on their card account.
Becoming an authorized user allows you to piggyback off someone else’s credit, without bearing any responsibility for making payments. Just make sure the account you’re being added to is in good standing, has a low balance and is paid on time all the time.
Once added as an authorized user to the card, the history of that card will appear on your credit reports. While you’re not responsible for paying the bills, your family member is, so if you do use the card (you don’t have to use it to have it appear on your credit reports), repay the primary cardholder for your charges so as not to create any ill will.
Once your credit score has benefited from being an authorized user, you can then apply for a card of your own and then ask to be removed from the authorized user card.
The bottom line
Choosing a starter credit card can seem daunting, but if you answer some important questions that could help narrow down your search, you can find the right card. Whether it’s a secured card, a credit card for fair credit or a student card, there are plenty of options.
If you’re not ready to open your own credit card, you can ask a family member to add you as an authorized user and begin building credit that way. Once you’ve established a fair or good credit score and are comfortable using plastic to pay for purchases, you can open your own card down the road.