Best Credit Cards for Young Adults Today
Today’s best credit cards for young adults need to offer rewards for travel and dining, low or no fees and manageably low APR. It also needs to have easy credit score requirements to fit thin credit profiles of recent college graduates and young professionals. It is hard to find all these qualities in one card, that’s why we created this guide to help you navigate in the best credit card offers.
In this guide we cover different scenarios typical for young people:
- beginners card for no credit history
- student credit cards
- card for earning travel rewards on work and leisure travel, eating out and entertainment
- card for transferring old student credit card debt
Starter Credit Cards for No Credit
Unless your parents reported your chores to the credit bureau as some form of regular payment on a lifetime debt owed to them, you're likely to start out with no credit at all.
A starter credit card is usually the best option when you first try to build your credit history. Because lenders don’t have a credit history to consider when you are starting out, or have any idea if you will make your payments in a timely manner, some traditional companies will insist on a secured line of credit leaving you with a secured credit card option.
The best strategy will be to apply for an unsecured credit card (ideally with a pre-qualification that doesn’t hurt your credit score). If you got turned down, the second option is a secured card.
Unsecured card for no credit
If you want an unsecured card with no credit, one of the best options is the Capital One Bank Platinum card. The card doesn’t charge an annual fee or an international transactions fee. Initial deposit is low – around $200-$300, but in 6 months you usually can ask for a credit limit increase.
Another option – Credit One Bank® Platinum Visa® for Building Credit. This card offers 1% cashback on gas and groceries, annual fee depends on your credit level and varies from $0 to $99.
See if you Pre-Qualify without harming your credit score.
This fully unsecured credit card with no deposit requirement can be helpful in growing or building credit. Your account activity will be reported monthly to all three major credit bureaus.
All the features you want in a credit card are included. Get 1% cash back on eligible purchases, take advantage of free online credit score tracking, and enjoy credit line increase opportunities. Terms apply.
$0-$99 annual fee
Secured credit cards
The only drawback of a good secured card is the need to hold your deposit in the bank – usually several hundreds of dollars that is equal to your credit limit on the card.
Your line of credit is backed by money you give them as a security deposit in the event you should default on your account. Most secured credit cards are reported to the credit bureaus, which gives you a chance to build your credit, and gives your lender a way to track your payment history with them. If you do start out with a secured credit card, rest assured that it won't be forever. Once the lender sees how capable you are, they may offer to move you to an unsecured account. And, over time, you will establish a credit history, which will help you qualify for other credit cards.
Best secured cards are the ones that have lower costs and ideally provide you with rewards.
Discover it Secured card is the one with no annual fee that will save you money along the way to a good credit. It will also earn you 1% cashback on all of your purchases and 2% on gas and restaurants.
Building Credit with First Credit Card
Once you do have an open account or card, avoid using all your funds or maxing out your card limit. In fact, it is recommended that you keep your total debt under 30% of the credit available to you. It looks good in general on your report, but your credit card issuer is also more likely to increase your limit when you don't use all of it to begin with.
With all that being said, you don’t have to always carry a balance to maintain good credit. Because of the APR, you will likely have when you start out, it’s best to pay your balance in full each month in order to avoid paying high amounts of interest. For the most part, lenders want to see that you make your payments on time and are responsible with the credit you have available to you.
Best Student Credit Cards
Not all cards are the same. Some are designed for specific people in mind. They offer rewards that are meant to align with your lifestyle. So, if you're in college, you might prefer a card that offers cash back for being on the Dean's List, or one that lets you earn points every time you get gas or order a pizza. Pay as much attention to the small details in the form of rewards and perks as you do to the costs associated with your account. You may even find that some credit cards charge no interest for a limited period of time or no annual fees. There are also cards which waive late fees if you accidentally miss your payment due date.
Many of the best first credit cards are student cards which focus on the types of spending you might have while in college and the likelihood that you are trying to build a positive credit history. Some of our recommendations for the best college student cards include the following:
Discover it for Students offers as much as 5% cash back and comes with an introductory APR of 0% for purchases for 6 months and 10.99% for balance transfers for 6 months. Plus, you can get a $20 cash back bonus each year your GPA is 3.0 or higher for the next 5 years. Discover currently matches all the cash back you earn your first year as a cardholder, at the end of the year. There is no annual fee for this card.
no annual fee
no credit needed
5% cashback on changing categories
double first year cashback
Citi ThankYou Preferred for Students. This card awards 2x points for dining at restaurants and entertainment, and 1x point for all other purchases. New cardholders can earn 2,500 points after spending $500 in the first 3 months of opening the account. There is a 0% intro APR for purchases for 7 months and no annual fee.
Ideally, the best card for you is the one that fits your lifestyle. It doesn't matter if you took a job in a factory, just started college, or are a stay at home mom. There's a card out there designed for someone just like you.
Best Rewards Credit Cards for Young Professionals
Young professionals often already have some credit, usually, spend more money than a college student, travel more frequently for work, and often regularity eat out with friends and colleagues.
Today many young people keep using a debit card for everyday spending, but at some point, you need a credit card. In today's world, there's really no way around it. It's not just because you need to be able to take your clients out for lunch once in a while, either. It's because employers want to see that you are a reliable and productive person. If your credit doesn't exist or is horrible, they aren't likely to trust you with their accounts. You need every edge you can get if you plan on climbing the corporate ladder to the top without something like a lack of financial understanding getting in your way.
Good to Excellent Credit
If you are lucky to have a credit score in good to excellent range in the young age, you can enjoy credit cards with great rewards and lower APR. One of the greatest cards with travel and dining rewards is a Chase Sapphire Preferred credit card. No annual fee and no international transaction fee make it easier to keep this card as your main card. Double points on all travel purchases and dining work great when you travel a lot for your job or enjoy occasional getaways before starting a family.
$95 annual fee, waived for the first year
or no annual fee for basic Sapphire card
2x points on travel and dining
1 point per dollar on all other purchases as usual
the card is made of metal
For Average Credit
With just an average credit score, your best pick is Barclaycard Rewards MasterCard®. It is no annual fee credit card with 2% cashback on gas, groceries, and utilities (I know, not the most exciting things).
Best Balance Transfer Cards for Young People
If you have old student debt sitting on your first credit card with high APR, it might be a good idea to transfer this balance to a card with 0% balance transfer offer. One of the best cards for balance transfers for young adults with short from excellent credit scores is a Chase Slate credit card.
This card has 0% intro transfer rate and 0% balance transfer APR for 15 months. No annual fee and low ongoing APR make it a good option for paying off balances.
Tips for Using Starter Credit Cards
Some tips you should be aware of when you start building your credit.
- Be sure to read everything carefully before you accept the terms and conditions of any line of credit.
- If you can't meet the card obligations, you're going to do more harm than good to your report.
- Take perks, rewards, annual fees, interest rates, and any fees into account.
- Budget accordingly and be sure to always make your payments on time.
It really only takes one open account in good standing to get the ball rolling. So, you may as well get started on researching the card meant for you today.
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