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Building Credit with a Credit Card? Here are your best options!
When you are first starting out and don’t yet have any credit established, getting approved for a credit card so you can begin to build credit can be difficult. If you’ve had any credit problems in the past, you’ll likely find yourself in a similarly frustrating position. Consumers in these situations often feel trapped in an unfortunate cycle of needing credit to build credit – but not being able to qualify. Luckily there are credit card issuers that offer cards specifically designed for people who need to build credit. If you don’t have any credit established, or you are on the path to building a more positive credit rating, these are some of the most popular credit cards for building credit.
Fair or Average Credit Scores
Whether you’re new to the credit world or fixing past mistakes, your credit score might be less in the “poor” range and more in the “fair” or “average”. If this is the case, you may qualify for and be able to build your credit score with an unsecured card for those with lower credit scores. While these types of cards usually carry higher than normal APRs, if you are diligent in paying your balance in full each month before your due date, you can build your credit without paying high amounts of interest.
| regular APR | |
earn 1.5% on all purchases with no cap and limitations
fair credit / no credit required
$39 annual fee
good for average credit/limited credit
1.5% cash back
This card comes with an APR of 23.24% for purchases and balances as well as an introductory APR of 0%. It has an annual fee of $39, but it awards 1.5% cash back on every purchase you make with the card. If you make your first five monthly payments on time, you can qualify for a credit limit increase. This card also includes free access to your credit score and CreditWise, which helps you to manage your credit profile.
Student Credit Cards
College students typically have the most problem with not having enough credit to get credit. Cards for college students like the following are designed to meet the needs of those in school who are beginning their journeys and can help get you started on the right foot.
| regular APR | |
- get 1% cash back on al purchases
fair credit / no credit required
no annual fee
student card
up to 1.25% cash back
This card has a variable APR of 20.24% and no annual fee. You can earn 1% cash back on all your purchases, which isn’t an option that many student credit cards offer. Plus, if you make your payment on time, you can boost your cash back to 1.25% for that month. The Journey Student Credit Card also includes access to your credit score and CreditWise. And after you make your first five monthly payments on time, you can qualify for a credit limit increase.
For building credit, also consider our editor’s picks for the best student credit cards.
Secured Credit Cards
Secured credit cards work the same as unsecured except that they require a security deposit that is held by the card issuer in the event that you default on your balance. Most of the time, you can’t even tell the difference between the cards and you can use yours just as you would any card. It’s important when selecting a secured credit card, however, that you choose one that reports your account activity to the credit bureaus so you can build a positive credit rating.
no annual fee bad credit or no credit 25 days grace period $49-$200 security deposit
regular APR bad credit / no credit required
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You can build or rebuild your credit easily with the Capital One Secured MasterCard. This card has a variable APR of 24.99% but is one of the rare secured credit cards without an annual fee. It requires a security deposit of $49, $99, or $200, depending on your credit worthiness, and in exchange you receive a credit card with a limit of $200. As you manage your account, your payments are reported to the credit bureaus to help you build a positive credit rating.
U.S. Bank Secured Visa®
The U.S. Bank Secured Visa has a variable APR of 19.24% and an annual fee of $24. You are required to make a deposit of at least $300. Your payments to the card are reported to the credit bureaus, which can help you build your credit rating. This card also allows you to earn interest on your security deposit so that after your credit has improved and you are able to qualify for an unsecured card, you receive a little extra when you get your deposit back.
| regular APR | |
- 2x miles on gas and groceries
- 1x miles on all other purchases
- get 5,000 bonus on first card use
bad credit required
$25 annual fee
$0 first-year fee
reports to credit agencies
24 days grace period
unsecured card offer after 12 months
You can find more of our favorite secured credit cards for building credit here.
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