When it comes to establishing a good credit score, using a credit card responsibly is one of the most effective ways. However, if you’re new to the world of credit, choosing the right credit card can be a daunting task. Here’s a look at what the best credit cards for beginners usually offer, as well as five credit cards that can help you get your credit life started on the right foot.
How to Find the Best Credit Cards for Beginners
If you’re new to credit cards, it’s hard to figure out what to look at to ensure the options you’re considering are great fits based on your needs. However, some strategies typically help.
First, check the interest rate. As a beginner, you might not qualify for the lowest rates available on the market. However, having as low a rate as possible makes a difference, so don’t overlook the APR when evaluating your options.
Next, look for cards that report to all three credit bureaus. If you’re trying to build your credit history, having an account in good standing showing on all of your credit reports helps you establish a positive credit history broadly over time.
After that, consider rewards programs. Some credit cards come with a variety of perks, such as the ability to earn points or cashback on purchases.
Additionally, look into the company’s reputation, particularly when it comes to customer service. Good customer service can be vital if you have questions or issues with your card. You might also want to get recommendations from friends or family members who have credit cards, as they may have valuable insights to share.
Finally, always read the terms and conditions of any credit card you’re considering before making a final decision. That ensures you know what benefits and drawbacks come with the card, allowing you to make sure it’s the right fit for you.
5 Credit Cards That Help You Get Your Credit Life Started
1. Discover it Secured Credit Card
If you have a limited credit history or no credit at all, a secured credit card can be a great option to start building your credit. The Discover it Secured Credit Card is one of the best-secured credit cards available, and it’s an excellent choice for people who are new to credit.
This card requires a security deposit, which acts as collateral and sets your credit limit. You can choose a security deposit amount between $200 and $2,500, and your credit limit equals the amount of your deposit. With responsible use, you can eventually qualify for a higher credit limit and get considered for an unsecured credit card.
One of the best things about the Discover it Secured Credit Card is that it offers cashback rewards on eligible purchases. You’ll earn 2 percent cashback at gas stations and restaurants on up to $1,000 in combined purchases each quarter and 1 percent cashback on all other purchases. Plus, Discover will match all the cash back you earn at the end of your first year.
The card has no annual fee, and it also provides free access to your FICO credit score, which can help you track your progress as you build your credit history.
2. Capital One QuicksilverOne Cash Rewards Credit Card
The Capital One QuicksilverOne Cash Rewards Credit Card is a standout option for people with average credit who want to earn cashback rewards on their purchases. It offers 1.5 percent cashback on all purchases, and the rewards don’t expire as long as the account is open.
This card does have an annual fee of $39, but it also offers benefits such as fraud coverage, travel accident insurance, and extended warranty coverage on eligible purchases. Additionally, Capital One provides access to CreditWise, which is a credit monitoring tool that can help you keep an eye on your credit score.
One thing to keep in mind with the Capital One QuicksilverOne Cash Rewards Credit Card is that it’s designed for people with average credit. If you have a limited credit history or no credit, you may not be approved for this card.
3. Petal 1 Visa Credit Card
The Petal 1 Credit Card is a solid choice for people who are new to credit or have little in the way of credit history. It has no annual fee, and it also offers cashback rewards on eligible purchases. The card also provides access to a credit score dashboard, which can help you track your credit score over time.
What sets this card apart is that it uses an alternative underwriting process that takes into account factors beyond just your credit score, such as income and spending patterns. This approach can help people who might not qualify for traditional credit cards get approved and start building their credit.
With the Petal 1 Visa Credit Card, you can earn 2 to 10 percent cash back on eligible purchases. The card also offers a mobile app that makes it easy to track your spending and payments.
4. Discover it Student Cash Back
The Discover it Student Cash Back card is an excellent option for college students who are new to credit or don’t have much of a credit history. This card offers cashback rewards on eligible purchases, and it has no annual fee.
As a student, you can earn 5 percent cash back on rotating categories each quarter (up to $1,500 in purchases per quarter) and 1 percent cash back on all other purchases. Additionally, Discover will match all the cash back you earn at the end of your first year. This card also offers a $20 statement credit each school year if your GPA is 3.0 or higher for up to the next five years.
One thing to keep in mind is that the Discover it Student Cash Back card is designed for students, so you’ll need to provide proof of enrollment when you apply. Also, if you’re under 21, you may need a co-signer for this card. But on a good note, no credit score is required to apply, making this a solid choice for students who don’t have a credit history.
5. OpenSky Secured Visa Credit Card
The OpenSky Secured Visa Credit Card is another great option for people with little to no credit history. This card requires a security deposit, which will determine your credit limit. The minimum deposit is $200, and your credit limit can be as high as $3,000.
This card has no credit check, which means you can get approved even if you have a low credit score or no credit history. Additionally, the OpenSky Secured Visa Credit Card reports to all three major credit bureaus, which can help you build your credit history over time.
The card does have an annual fee of $35, but it also offers benefits such as fraud protection and the ability to set up automatic payments. This card can be a good option if you’re looking to establish credit and don’t have a lot of money to put down as a security deposit, so it’s worth keeping in mind.
Do you know of any other options that should be on the list of the best credit cards for beginners? Do you use any of the credit cards mentioned above and want to tell others about your experience? Share your thoughts in the comments below.
Read More:
- Is Having No Credit Worse Than Bad Credit?
- How to Build Credit Without Getting into Debt
- Which Credit Building Program Should I Use?
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Tamila McDonald is a U.S. Army veteran with 20 years of service, including five years as a military financial advisor. After retiring from the Army, she spent eight years as an AFCPE-certified personal financial advisor for wounded warriors and their families. Now she writes about personal finance and benefits programs for numerous financial websites.
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