The adage “it’s not how you start a race, it’s how you finish it” isn’t quite accurate when it comes to credit. Finding the finest credit cards for building credit for new credit users might provide you with a helpful head start if you’re just beginning your financial path. For those who have never used credit before, the market has a wide variety of cards to choose from, but even seasoned credit users sometimes become perplexed by the terms and restrictions. We’ve developed a list of the top 15 credit cards for building credit for first-time users so you may responsibly use them to establish a solid credit history. Although there are countless credit cards for building credit available, most of them require some kind of credit history to be eligible. This might make it difficult for those to apply for a card who have poor credit (usually a credit score below 580) or no credit at all.
One of your best possibilities for getting approved for credit is through secured credit cards for building credit. They function similarly to standard cards in that they grant credit, impose interest charges, and occasionally give incentives, but they need a deposit (often $200) before you can access the credit limit. Your credit limit is determined by the amount of money you deposit. If you want a greater credit limit, you must deposit more money. If you don’t pay, the security deposit serves as collateral. But don’t worry—you won’t lose that cash—because your deposit is returnable if you settle your account’s amount in full.
15 Best Credit Cards for Building Credit 2023
For those with no credit or bad credit who don’t want to—or are unable to—put down a deposit, there are some alternative credit card possibilities in addition to secured cards. Although using a credit card for building credit might make it simple to establish a solid credit history, you must utilize it properly. After you open a credit card, be careful to use it responsibly and make prompt, complete payments on the balance. Select looking credit cards for building credit for people with no credit history or bad credit to find the best ones for building or fixing credit. We took into account a variety of elements, including fees, incentive programs, security deposit minimums, and APR.
Here are some of our favorites: In our list of best overall credit cards for building credit, we have a traditional unsecured card, a card just for students, and a secured card for people who are just starting out with credit. These credit cards for building credit provide a number of benefits to help you start building credit and won’t burden you with fees.
Due to its cheap interest rates, lack of annual fees, and frequent credit limit increases after your first five on-time payments, the Capital One Platinum Credit Card is a fantastic first credit card. This card doesn’t offer a tonne of extra benefits, but it also doesn’t have the fees that frequently come with cards with more rewards.
The Discover it® Student Cash Back card’s main goal is to give its users rewards. Numerous beneficial benefits are available to students, including cash back, free FICO ratings, low APRs, and bill credits for each authorized referral of a friend.
One of the simplest ways to raise your credit score is with secured credit cards, and the Capital One Platinum Secured Credit Card is the best option available. For instance, Capital One uses your credit history or information about your verifiable income to establish your needed deposit amount, unlike other secured credit cards for building credit that demand a refundable security deposit that equals your credit limit (for instance, a $500 deposit results in a $500 limit). You may need to make a deposit of $49, $99, or $200 depending on the bank’s evaluation in order to access a $200 credit limit.
The best “cash back” cards are for those with bad credit
With the right cash-back credit card, you can make money while you learn. This is due to the fact that the card issuer will reimburse them for a portion of each transaction you make using your card. The percentage you earn will vary depending on the card, but we have shortened the list to highlight the top cards for new customers.
With the Capital One® QuicksilverOne® Cash Rewards Credit Card, you can earn up to 1.5% cash back on every purchase. It takes some practice to balance changing categories and benefits, so the flat cash back rate makes this a great card for beginner credit users. Make sure you’ll use the card frequently enough to make up for the $39 annual charge before applying for this card.
Once your bonus categories are activated, the Discover it® Student Cash Back gives one of the best cashback rates for students, if not the highest cashback rate. For purchases made at well-known retailers who switch up their categories every three months, these categories provide additional cash back.
The Discover it® Secured Credit Card is one of the few secured credit cards for building credit that offer cash back; other secured credit cards only offer the bare minimum. When you open your account and pay a refundable security deposit (the same amount as your credit limit), you can start getting rewards.
The best “business” cards for people with bad credit
Your personal credit score is typically used to determine if you are authorized for business credit. Therefore, it may be challenging to get a company credit card for individuals who have poor credit, no credit history, or neither. With these cards, people who want to start their own businesses can build their credit history and grow their businesses.
Finding a business credit card that doesn’t overcharge for membership is essential since operating a business is costly. The Capital One® Spark® Classic for Business credit card offers 1% cash back on all purchases and has no annual or international transaction fees. Also, the card helps build your company’s credit profile, which is good for any new business.
Your refundable security deposit will be the same amount as your credit limit on your Wells Fargo Business Secured Credit Card. Additionally, every purchase made with the card will earn you 1.5% cash back. Wells Fargo gives cash back in the form of direct deposits to qualified corporate checking or savings accounts or quarterly statement credits.
- Get 1.5% cash back on every dollar spent with a credit line of $500 to $25,000.
- Absence of foreign transaction fees
- Provide up to 10 staff cards; each card’s yearly charge is $25.
Compared to secured consumer cards, secured corporate credit cards are less prevalent. Many commercial products are restricted to certain states or areas. Wells Fargo, on the other hand, is a well-known national brand that takes credit cards wherever Mastercard is accepted.
The BBVA Secured Visa® Company Credit Card gives business owners three times as many points for their most common purchases, like gas, restaurants, office supplies, and printing. Every dollar spent on the card for all other purchases results in a fixed 1x point reward.
- Earn 2x points at petrol stations and restaurants, and 3x points at office supply stores.
- Earn 1 point for every $1 spent on anything else.
- The first year is free; after that, it costs $40.
To start a Secured Credit Card Savings Account and apply for this card, you must deposit a minimum of $500. Then, your credit limit will be equal to 90% of the amount you’ve put down. At the moment, this card can only be used by people from Alabama, Florida, Texas, Arizona, Colorado, California, and New Mexico.
The best student cards for first-time credit users
Credit cards for building credit, while you are still in school, are easy with a student card. Bad credit history makes it more difficult and possibly more expensive to rent an apartment or get a loan. Our best picks include cheap or no costs, in addition to the opportunity to receive cash rewards, which may be used to buy pizza during late-night study sessions.
The Discover it® Student Cash Back card is the king of student cards because it gives students cash back at a rate that had never been seen before. Utilizing Discover’s somewhat unusual sign-up bonus can significantly increase your cash-back possibilities. When combined with the bill credit incentive for authorized referrals, this card is great for students who want to earn a lot of cashback.
Holders of the Student Chrome Card benefit from a low-interest rate and can get cashback incentives. Students receive a statement credit, like with its brother, the Student Cash Back card, for recommending friends who apply for and are approved for their own cards. This card is ideal for you if you’d rather not deal with managing a calendar and changing categories.
With a two-part cashback scheme, Capital One’s Journey Student Rewards program rewards its cardholders for making on-time payments. All members get 1% back on each purchase made using the card, and all members get 1% back. However, you will receive an extra 0.25% cash back on the total you pay off each month if you pay your bill on time.
The best “secured” credit cards for first-time users
Consider a secured credit cards for building credit as the first piece of plastic in your wallet if you’re a careful person who doesn’t want to make costly blunders at a young age. To start an account, these cards need a refundable security deposit; however, they frequently have cheaper fees and a spending cap on the amount of the deposit.
Depending on your credit score and proof of income, you might not have to pay the full security deposit to get a Capital One Platinum Secured Credit Card. Based on the information you provided, Capital One will determine whether you must pay a $49, $99, or $200 deposit. Each credit has a $200 credit limit at the beginning, but Capital One may increase it once you’ve made your first five on-time payments without requiring you to make a bigger deposit.
Your whole Discover it Secured Credit Card credit limit will be equal to the amount of your refundable security deposit. Discover has a minimum deposit required to start an account, but it provides a unique cash-back option for protected cards.
Since there is no credit check needed to create an account with the OpenSky® Secured Visa® Credit Card, your lack of credit history won’t be an issue when you apply for the card. By responsibly using OpenSky, which records your payment history to the three main credit reporting bureaus, you may raise your credit score.