Credit Cards » Compare Credit Cards » The Best First Credit Cards For Beginners of June 2023
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The Best First Credit Cards For Beginners of November 2023

Getting your first credit card as a young adult is the first step toward financial independence. How to choose it and which cards are best?
Author: Lorraine Smithills
Lorraine Smithills

Writer, Contributor

Experience

Lorraine is a freelance finance writer with years of experience in the banking sector and after a successful career in one of the largest retail and commercial financial services providers. She has a passion for helping people with less financial confidence to get control of their money through budgeting, saving, and responsible credit practices.
Interest Rates Last Update: September 20, 2023
The banking product interest rates, including savings, CDs, and money market, are accurate as of this date.
Author: Lorraine Smithills
Lorraine Smithills

Writer, Contributor

Experience

Lorraine is a freelance finance writer with years of experience in the banking sector and after a successful career in one of the largest retail and commercial financial services providers. She has a passion for helping people with less financial confidence to get control of their money through budgeting, saving, and responsible credit practices.
Interest Rates Last Update: November 1, 2023

The banking product interest rates, including savings, CDs, and money market, are accurate as of this date.

We earn a commission from our partner links on this page. It doesn't affect the integrity of our unbiased, independent editorial staff. Transparency is a core value for us, read our advertiser disclosure and how we make money.

Getting your first credit card as a young adult is the first step toward financial independence. Having a credit is beneficial for building your credit history, making large purchases, and emergencies.

On another note, it’s best to proceed with caution. Like many financial decisions, using a credit card involves risk as well as benefits. If you aren’t ignorant of the risks, you are a step ahead towards using a credit card the right way.

Here are The Smart Investor select's picks of top credit cards for beginners:

Card
Rewards
Bonus
Annual Fee

Capital One QuicksilverOne Cash Rewards

1.5% unlimited 1.5% cashback on every purchase
None
$39
Review

chime card

None
None
$0
Review
citi-custom-cash_
1-5% 5% cash back on your highest eligible spend category each billing cycle up to the first $500 spent and 1% cash back thereafter
$200 $200 cash back after you spend $1,500 on purchases in the first 6 months of account opening (20,000 ThankYou® Points, which can be redeemed for $200 cash back)
$0
Review

Upgrade_CashRewards card

1.5% 1.5% cash back on payments
$200
$0
Review

Petal 2 Visa card Review

1.5% 1% cash back on all purchases, 1.25% after 6 months of on time payments, and 1.5% after 12 months of on time payments
None
$0
Review

When Should You Get Your First Credit Card?

Credit cards are an unavoidable part of modern life, and for many individuals, the benefits outweigh the drawbacks. When a person should acquire their first credit card is largely determined by how responsible they (or their parents) believe they will be with it.

The optimum time to apply for a credit card is usually before you need one. As long as you have the necessary money to repay your expenditures, college or shortly after graduation is a fantastic time to start using a student credit card. Many credit card companies offer cards tailored to students, but like with any credit card, it's a good idea to shop around and compare rates and restrictions.

Capital One QuicksilverOne Cash Rewards

Capital One QuicksilverOne Cash Rewards

Capital One QuicksilverOne Cash Rewards

Reward Details

1.5% unlimited 1.5% cashback on every purchase

Current Offer

None

Credit Rating

Fair

Annual Fee

$39

0% Intro

None

APR

29.99% (Variable)

The Capital One Quicksilverone Cash Rewards card earns unlimited 1.5% cashback on every purchase, without requiring category activations while it's one of the few cash back credit cards that require a fair credit. However, make sure to pay on time since the variable APR is quite high.

QuicksilverOne Cash Rewards card charges  an annual fee of $39 and can be a good choice if you are looking for a credit card for fair credit to earn cashback rewards across all purchase categories at a low annual cost. 

  • APR: 29.99% (Variable)
  • Annual fee: $39
  • Balance Transfer Fee: None
  • Foreign Transaction Fee: 3%
  • Rewards Plan: unlimited 1.5% cashback on every purchase
  • Sign Up bonus: None
  • 0% APR Introductory Rate period: None
  • 1.5% Cash Back
  • Build Your Credit
  • No Rewards Limits
  • No Transfer Fees
  • No-Cost Fraud Liability
  • Annual Fee
  • Redemption Limits
  • Foreign Transaction Fee
  • High APR

Is there a limit to cash back rewards?

There is no sort of limit in place as to how many rewards you are able to get when using the Capital One QuicksilverOne Card to make purchases.

Can I get car rental insurance with QuicksilverOne Card? how?

Yes, if you decline the insurance from the car rental company and pay for the entire rental with your Capital One QuicksilverOne Card you will be able to get coverage.

Does card QuicksilverOne Card travel rewards points expire?

Once you keep your account open, the rewards that you earn through making purchases with the Capital One QuicksilverOne Card will not expire.

What are QuicksilverOne Card income requirements?

There are no income requirements that you will need to meet when you are applying to get your hands on a Capital One QuicksilverOne Card.

What is the initial credit limit?

You will get at least $300 in credit limit straight away with the Capital One QuicksilverOne Card. Higher limits are possible and will depend on your personal financial situation.

How do I redeem cash back on QuicksilverOne Card?

You can redeem the rewards that you earn when using the Capital One QuicksilverOne Card for cash, statement credit, or for gift cards from certain retailers.

How hard is it to get QuicksilverOne Card?

You often need to have a credit score of at least 620 in order to get the Capital One QuicksilverOne Card. The rest of the requirements are quite straightforward.

 

Chime® Credit Builder

Reward details

None

Current Offer

None

Credit Rating

Good – Excellent

Annual Fee

$0

0% Intro

N/A

APR

0%

The Chime builder card is a great card for beginners who would like to build credit. To qualify for most cards, you must be able to demonstrate your ability to manage credit, which can be a catch.The Chime Credit Builder card was created to address this issue. It is intended to be used in conjunction with a Chime Spending Account.

You can fund your Credit Builder card with funds from your account. You can then use your card at any retailer or store that accepts Visa. Chime will notify Equifax, TransUnion, and Experian about your card activity. There is also the option to enable the Safe Credit Building feature. This automatically pays your card's balance on time.

The main limitation of the card is that your card limit is determined by the balance in your account. So, if you have $300 in your account and spend $150 on your Chime Credit Builder Card, your limit will be $150 for the next month until you add more funds to your account.

  • Rewards Plan: None
  • APR: 0%
  • Annual fee: $0
  • Balance Transfer Fee: N/A
  • Foreign Transaction Fee: 0%
  • Sign Up bonus:None
  • 0% APR Introductory Rate:N/A
  • No Minimum Deposit
  • No Fees
  • No Credit Check
  • Auto Payment Option Available
  • You Need a Chime Spending Account
  • Need Funds to Set Your Credit Limit
  • Card Limit Can Vary
  • No Credit Utilization Score
  • No Option to Upgrade to Another Card

What are the Card Income Requirements?

Chime does not have any income requirements for the Credit Builder credit card. You will need to open a Chime Spending account, but this does not require a credit check. This means that you will not need to prove your income to access the Chime banking services.

Does the Card Ask for Proof of Income?

This is not necessary for Chime, but to determine your credit limit, Upgrade may require that you provide proof of income.

Can I Get Pre Approved?

The only pre approval you need for the Chime card is to open up a Chime Spending account, but this does not require a credit check. It is not possible to open a Chime card account without having a Spending account.

What is the Initial Card Credit Limit?

Your initial Chime credit limit will be determined by how much you transfer to your Credit Builder account. You can transfer as little or as much as you like and then use the card as you would a prepaid debit card.

What are the top reasons not to get it?

The top reason not to get the Chime card is that you don’t want to open a Spending account. The Chime card is an integrated product, which requires transfers from a Chime Spending account. So, if you are happy with your current checking account and simply want a credit card, this is not the right choice for you.

Does the card report payments to all credit bureaus?

Chime does report payment activity to all the credit bureaus, which helps to build or rebuild your credit.

Citi Custom Cash℠ Card

citi-custom-cash_

Citi Custom Cash℠ Card

Reward details

1-5% 5% cash back on your highest eligible spend category each billing cycle up to the first $500 spent and 1% cash back thereafter

Current Offer

$200 $200 cash back after you spend $1,500 on purchases in the first 6 months of account opening (20,000 ThankYou® Points, which can be redeemed for $200 cash back)

Credit Rating

Good – Excellent

Annual Fee

$0

0% Intro

15 months on purchases and balance transfers

APR

19.24% – 29.24% (Variable)

The Citi Custom Cash℠ Card is a good option for those for aren't spending too much on their card and mainly focus on a specific category. It can be a  bit difficult to get it as a beginner, but in case you already have a Citi account that may be possible.

The rewards rate is pretty high for such cardholders - 5% cash back on your highest eligible spend category each billing cycle up to the first $500 spent and 1% cash back thereafter. In addition, new applicants are eligible for a sign up bonus of $200 cash back after you spend $1,500 on purchases in the first 6 months of account opening (20,000 ThankYou® Points, which can be redeemed for $200 cash back).

The card has no annual fee and provide generous 0% intro APR for new cardholders.

  • APR: 19.24% - 29.24% (Variable)
  • Annual fee: $0
  • Balance Transfer Fee: $5 or 5% (the greater)
  • Foreign Transaction Fee: 3%
  • Rewards Plan: 5% cash back on your highest eligible spend category each billing cycle up to the first $500 spent and 1% cash back thereafter
  • Sign Up bonus: $200 cash back after you spend $1,500 on purchases in the first 6 months of account opening (20,000 ThankYou® Points, which can be redeemed for $200 cash back)
  • 0% APR Introductory Rate period: 15 months on purchases and balance transfers
  • High Cash Back Rate
  • 0% Intro APR
  • Sign-Up Bonus
  • No Annual Fee
  • Balance Transfer Fee
  • Low Cap on Higher Cashback
  • Foreign Transaction Fee

Can I get car rental insurance with Citi Custom Cash Card?

Yes, it offers rental insurance for cars if you pay for the full cost with this credit card and you decline the rental company’s insurance.

Is there a cash-back rewards limit?

Besides the cap on specific categories, there is no limit in place with this card on how many total rewards you can earn. Therefore, people who will be spending large sums on purchases can ideally take advantage of this offering.

What is the initial credit limit?

The initial credit limit will usually be $500 for this card. The exact limit that will be in place will depend on your financial situation (can be much higher).

Should You Move to Citi Custom Cash Card?

If you don't tend to spend more than $1,000 - $1,500 every month and you tend to spend them on specific categories, this card can be a perfect fit due to the high cashback on the your top category.

What purchases don't earn cash back?

All purchases earn cashback as a result of using this card. Therefore, you will be able to take a very flexible approach and know that you will always be able to earn reward no matter the type of purchase.

How to maximize rewards on Citi Custom Cash Card?

Make sure that you avail of the signup bonus and that you maximize the 5% cashback offering each cycle. This will allow you to get the best bang for your buck.

Upgrade Visa® Card with Cash Rewards

Reward Details

1.5% cash back on payments 1.5%

Current Offer

$200

Credit Rating

Fair

Annual Fee

$0

0% Intro

N/A

APR

14.99% – 29.99%

The Upgrade Visa® Card with Cash Rewards is a good pick if you are looking for a no-annual-fee credit card with a flat-rate cashback reward while having a fair-average score. A particularly attractive feature of the Upgrade Visa Card in relation to similar credit cards is the complete absence of fees, transactional or otherwise, on the card.

It offers 1.5% cash back on payments, but you should be aware that the cash backs on all your purchases with this card are only given when you make payments, not before. This is the only reward you get; so if you want intro rates or welcome bonuses, consider other alternatives.

Unlike conventional credit cards which charge you daily interest for carrying a balance, this card practically gives you a personal line of credit ($500 – $25,000 or more). This will be split into equal installments which you pay every month. You may use your credit line on purchases online, at retail stores, or even transfer the funds from your card to your personal bank account at no extra cost.

  • APR: 14.99% - 29.99%
  • Annual fee: $0
  • Balance Transfer Fee: Up to 5%
  • Foreign Transaction Fee: Up to 3%
  • Rewards Plan: 1.5% cash back on payments
  • Sign Up bonus: Earn a $200 bonus after you open & fund a Rewards Checking Plus account & make 3 debit card transactions within 60 days. If you previously opened a checking account through Upgrade or do not do so as part of this process, you are not eligible. Payout made within 60 days of meeting the conditions.
  • 0% APR Introductory Rate period: N/A
  • Unlimited 1.5% Cash Back
  • No Fees
  • Reports to Three Major Credit Bureaus
  • No Deposit Required
  • No Grace Period
  • Inflexible Payments
  • No Signup Bonus
  • Limited Availability

What are the Upgrade Card Income Requirements?

Upgrade does run a credit check for its credit cards, so your income to debt ratio will be a deciding factor. However, you can obtain pre approval for the cards, so you can confirm that you have sufficient income to qualify for the minimum credit limit.

Does the Card Ask for Proof of Income?

Upgrade will use your application information to determine pre approval, but to confirm your application, you may need to provide copies of paystubs or other proof of income.

What are the top reasons not to get the Upgrade card?

The top reason for not getting an Upgrade card is that you don’t want the card company to run your credit. If you already know you have a bad score or no credit history, a hard credit pull could have detrimental effects.

Can I add an authorized user?

Upgrade doesn't allow second users on their credit cards, so it is not possible to add an authorized user on these accounts.

How is Upgrade customer service availability?

If you want to speak to the Upgrade customer service team, there is a toll free number open Monday to Friday, 6 am to 6 pm and 6 am to 5 pm on weekends (Pacific Time). Alternatively, you can email the support team, but you’ll need to wait for a response

 

 

 

 

 

Petal 2 Visa

Reward Details

1.5% 1% cash back on all purchases, 1.25% after 6 months of on time payments, and 1.5% after 12 months of on time payments

Current Offer

None

Credit Rating

Fair

Annual Fee

$0

0% Intro

None

APR

17.49% – 31.49% Variable

Petal 2 Visa Credit Card offers students the benefits of a rewards card, no fees attached. This card does not charge annual fees, maintenances fees, foreign transaction fees, over limit fees, late payment fees or any kind of fee. It is a great choice for people who want to build their credit up without forgoing rewards. These rewards are offered as cash backs which will increase depending on your level of financial responsibility.

While using this card does not attract any direct fees, users who have a habit of defaulting in monthly payments will not get the best value out of this card. Considering that the upper limit of the APR is high, poor account management may have you paying considerably higher than you would expect to.

  • APR: 17.49% - 31.49% Variable
  • Annual fee: $0
  • Balance Transfer Fee: N/A
  • Foreign Transaction Fee: $0
  • Rewards Plan: 1% cash back on all purchases, 1.25% after 6 months of on time payments, and 1.5% after 12 months of on time payments
  • Sign Up bonus: None
  • 0% APR Introductory Rate period: None
  • No Fees
  • Cash Back Rewards
  • Reports to all Three Major Credit Bureaus
  • No Deposit Required
  • No Balance Transfer or Cash Advance
  • No Intro APR
  • Quite High APR

How long should I use the card to increase my credit score?

There is no set amount of time to increase your credit score, as this will depend on your circumstances. However, a good rule of thumb is three to six months. After this time, you should be able to see an increase in your FICO score.

Can I add an authorized user?

No, the petal 2 card issuer permits adding another user to your account.

How long does it take to get approval?

Petal has a similar time frame for its application approval. You’ll get an email decision quite quickly and should receive your new card within 10 days.

How is the card customer service availability?

The Petal customer support hours are 8 am to 10 pm EST Monday to Friday and 9 am to 6 pm on Saturdays.

Do the cards report payments to all credit bureaus?

Yes, Petal reports its account activity to all three of the credit bureaus. 

Does the card ask for proof of income?

Petal does typically verify your bank account and need confirmation of some key expenses. So, you may need to have proof of income to support your applicatio

Table Of Content

According to Experian Data, the average, Americans hold an average of 3.84 credit card:

Is It Easy To Get a Beginner Credit Card?

It's not a problem if you've previously graduated. Now are a lot of terrific first credit cards out there for young professionals— just pay attention to the credit standards and start with one that has a decent probability of acceptance.

It's critical for new graduates to follow the criteria for building and maintaining a strong credit score, regardless of the sort of credit card they have. Credit scores are determined by a number of criteria, the two most essential of which are payment history (does this person pay their bills on time?) and payment history (does this person pay their bills on time?) and credit usage ratio (how much credit are they using at any given time in comparison to how much credit they have available?). When a person's credit cards are all maxed up, their credit utilization ratio is high, and their credit score suffers as a result.

What Card Can I Get with Good Credit?

If you already have good credit and are looking for your first credit card, you should find that there are actually plenty of options. Just because it is your first credit card, it should not hinder your application, since the card issuer will be looking at your credit score and history.

You should be able to find cards with no annual fee, reward cards and even cards with introductory rates. So, don’t rush into applying for the first card you find, take a little time to assess your options and only apply for the card that best suits your requirements and preferences.

Starter Cards to Build Credit 

If you have no credit report, there are some credit card options that can help you to build a credit score. These include student credit cards that are designed for those with no credit file. If you need to rebuild your credit, you could consider a secured credit card.

This does involve putting some money into a deposit account, which will act as security for your card. Most issuers set your credit card limit to the amount of your deposit, so there is minimal risk for the credit card company. If you default, they can simply take the funds from your deposit. However, the benefit of this is that each time you make a monthly payment, it is reported to the credit bureaus, helping to boost your credit score.

First Credit Cards for Students 

There are a number of credit card companies that offer cards for students. These tend to have lower credit limits as students typically have a very limited credit history. However, it is possible to get student credit cards that offer some nice rewards.

For example, The Bank of America Cash Rewards for Students offers an introductory bonus and up to 3% cashback on your purchases with no annual fee. However, Bank of America sets your rate according to your creditworthiness. So, if you have no credit history, you are likely to be looking at paying 23% or more.

Can I Get First Credit Card With no Credit?

Getting a credit card when you have no credit history can be a challenge, but it is not insurmountable. There are a number of credit card providers who specialize in cards for those with limited credit. You will simply need to research your options. There is no point in applying for a card that has spectacular rewards and requires an excellent score, as there is little chance you’ll be approved.

However, it is quite simple to find more basic cards that have lower limits and fewer rewards that may be open to those with limited credit. Try not to be disappointed if you can only obtain a card with a very low limit, as you should see it as a stepping stone to build your credit. Every month when you make a payment, it will be recorded with the credit bureaus, building your credit history.

What First-Time Credit Card Users Need to Know?

Your first credit card can provide you with freedom, convenience, and opportunity all in one. Your first credit card, if used correctly, can help you develop credit and increase your capacity to borrow money in the future. Here are seven simple tips to help you get the most out of your first credit card.

Using a credit card to make purchases and get rewards is convenient, but it shouldn't be utilized to buy things you can't afford. You can avoid going into debt by having a realistic notion of how much you can spend and pay off at the end of the month.

The majority of major credit card companies include expenditure analysis tools that you can access through your online account. You select a time period – a month, a year, or a custom term — and the tool displays how much money you've spent on your card in various categories.

To see if you're pre-qualified, contact the credit card company. A soft inquiry (a sort of credit check that has no impact on your credit score) can help you figure out if your credit score is good enough to apply for a specific card.

Although pre-qualifications do not ensure that you will be approved for a particular credit card, they can assist you in narrowing down your possibilities for credit cards that meet your present needs.

Before deciding what to sign up for, make the most of this information and discover everything there is to know about any card that piques your interest.

There are a few no-fee credit cards available, which are usually a smart place to start when looking for your first credit card.

Many credit cards include a grace period, which is the time between the end of a billing cycle and the due date for your bill. You may not be charged interest on your debt during a grace period if you pay it off by the due date.

Interest will begin to accrue if you carry a portion of your balance over to the next month. Enrolling in autopay is a simple way to ensure that you never forget to pay your credit card bill.

To avoid being overcharged, it's critical to report fraudulent credit card charges as soon as possible. If you notice one of these, contact your credit card company right once to have them resolved.

Make paying attention to your credit card bill a habit. Seeing your spending patterns may also encourage you to make budgeting a pleasurable practice.

Credit card reward programs are appealing since they allow you to earn airline miles, cash, or meals. However, the requirements for earning the benefits of some incentive schemes may wind up costing you more than the rewards you receive.

Many rewards programs have a monthly or annual charge associated with them. Check the terms and conditions of any rewards program you're contemplating, and then compare any fees, like as higher interest, against how much you desire the prize.

If you use a credit card wisely, you can benefit from it. On another note, people who use credit cards for the first time usually abuse them. If you have a lot of debt, it’s hard to get a loan, own a home, and it causes financial hardship for you and your family.

When you obtain a credit card, it’s important to use it the right way, not accumulating debt. Having a budget and plan is a great start to avoid credit card debt.

Credit Card Loans At All Time High 

According to FDIC commercial banks' annual reports, credit cards loans increased three-fold from 232.4 million in 2001 to 734.7 million in 2020. However, this has not been a linear trend. During economic hardships, there have been noticeable drops in demand. 

 

Where to Get Your First Credit Card?

You can apply for your first card directly as well as talking to your bank and learn more what they can offer.

If you are attending university, you have a high chance of a reputable lender granting you a student credit card. It’s best not to think that every student credit card you see is a good one. Lenders apply high-interest rates and annual fees on student credit cards which can make them not suitable to apply for.

Which Issuers Have The Highest Score on JD Power?

American Express was named the best credit card company in 2020 by JD Power's 2020 US Credit Card Satisfaction Study. American Express had the highest score of 838 among national issuers in a customer survey conducted during the COVID-19 period. During the pandemic, a higher percentage of customers said American Express responded well. Discover is ranked second (837) while Bank of America is ranked third (812).

With an 816 score, Regions Bank is the most satisfied customer among regional bank issuers. With a combined score of 815, BB&T and PNC are tied for second place.

J.D. Power U.S. Credit Card Satisfaction Study 2020

If you have a bank account that’s in good standing, feel free to apply for a credit with them too. Since you have a relationship with that bank, you have a higher chance of them approving you for getting a credit card. Especially if you don’t carry negative balances or have overdrafts.

Even though you can apply online, going to a branch and meeting with a representative face-to-face gives you more headway to get approved.

Popular Complaints of Credit Cards Customers

A report by Consumer Financial Protection Bureau revealed issues with purchase information shown in the credit card statement was the highest complaint at 27%. Though not in a specific category, other features, terms, or problems followed at 13%. This is less by half compared to the leading complaint. However, Americans struggled the least with paying their bills, which stood at 2%.

 

Your First Card: Things To Do Before Applying

You usually have to be 18 to apply for your first credit card. If you are under the age of 21, you have to show additional documentation such as proof of income or assets to convince the lender you are able to pay back what you owe.

On the other hand, you will need someone over the age of 21, such as your parents, to make you an authorized user on their account. If you land a part-time job, you may be able to qualify for a student credit card because you are generating income. Keep in mind that you are solely responsible for paying your credit card bill on time.

What Score Do I Need to Apply?

The credit score range is from 350 to 850, which represents your creditworthiness. You have the option to check your score from the following bureaus: Equifax, Experian, and TransUnion. If this is your first time applying for a credit card, you will have little to no credit history. If you do have a high credit score, you can be eligible for cards with low-interest rates and higher credit limits.

If you don’t have enough credit history, it’s difficult to get a credit card. Even though it’s difficult to get a card with a credit history, there are other ways to get a credit card.

  • You can apply for a secured credit card. This type of card requires an initial deposit. Moreover, people with little to no credit history can easily obtain one.
  • Get a co-signer to sign with you on your credit card application. A person that co-signs gives a signal to the lender that you are able to pay your credit card off. If you don’t, you will not only damage your credit score but the co-signers too.

Getting a credit card for the first time can be difficult.  The dilemma is that you need a credit card to build credit, but you need credit to get a credit card. You see the issue at hand here? If you are dealing with this problem, look into getting a secured credit card.

These types of cards require a cash deposit that’s equal to the limit on the card that’s used for collateral if you fail to make payments. It’s important for you to use this card like a regular credit card and make your payments on time. Your deposit is just simply a safety net. Moreover, you have the option to transition your secured credit card to an unsecured one. The lender will also give you back your deposit.

How to Choose The Right First Credit Card?

Every credit card company say they have the best benefits; the question is which one is the right one for you?

Not all credit cards are identical to one another. Every card has their benefits, rates, features, and fees that accompany it. If you desire to pay off your bill per month, getting a student rewards card is a great way to go.

Moreover, certain student reward cards offer cash back opportunities on your purchases. Keep in mind though that there may be caps on your rewards card. If you know for certain that you will carry a balance, it’s best to look for a credit card with low interest. Typically, most student credit cards offer a 0% intro APR which lasts 6-8 months.

Look At The Big Picture

You have the ability to pay off big purchases without interest accruing on those purchases during the introductory period. Always research the best credit card options that offer low-interest rates, cash back rewards, no annual fee, and a good credit limit.

Also, look into the billing cycle so you will have clarity on your payment cycle to avoid unknown charges. Student credit card lenders offer free tools online to help you budget and keep track of spending.

Here are the terms to watch after to make the decision a lot easier for you:

The most important thing in a first credit card is tobuilf your credit. When your credit getting higher, you could get much better cards, better rewards and a lot of perks that are not available in beginner cards.

Make sure the issuer submit your payments to 3 credit reporting agencies, so it will be reflected in their stats. Check if the issuer is willing to review your account on a regular basis, how long until your  credit limit increase, and which options you can get after a year.

The credit is the amount your lender loans you each month. Since the length of your credit history is not long when you decide to apply for your first credit card, lenders will only give you a small amount of credit such as $300.

Whatever the limit is, it’s best not to max it out every month. You will keep a good credit score if your card utilization (which is the percentage of how much you use your card) is low.

If you come to the conclusion that your credit limit is too low, after several months, give your lender a call to request a limit increase. Don’t get too excited because it’s not wise to run up a balance you can’t afford to pay back.

There are credit card companies out there that charge a fee by just having their card. The fee can range from $15 to hundreds of dollars. Most people try to these avid these cards and are ignorant of the fact that these cards carry great reward benefits that offset the annual price.

Just like with the APR, make sure that the number you see is permanent, and not an intro offer just to reel you in

This is the rate that lenders charge you if you have an outstanding balance. For instance, if you don’t pay the balance off in full, you will owe interest on that balance.

It’s a good thing if you get a card with a low APR (Annual Percentage Rate). Even if you don’t carry a balance, it’s still wise to have a low APR. Also, research credit cards have 0% introductory rates. Also, keep in mind that the intro rate is only temporal; your APR will rise afterward.

It’s best to see if the APR after the intro is permanent or document the day the introductory period expires so you won’t be surprised later on.

Which Credit Card Types Have The Highest APR?

Based on a survey by CreditCards.com, the national average credit card rate stood at 17.57%. Americans who held bad credit cards were charged the highest interest rate of 24.99%, while the credit card for low interest enjoyed lower rates at 14.61%.

 

While it's not a common feature in most starter credit cards, there are still some cards that offer 1% cashback and sometimes even a bit more. 

Indeed, it's a not a lot of money – but it's always nice to get some extras.

Even though we recommend that you pay off your balance each month, the lenders don’t require you to do so; they desire to charge you interest on your purchases instead. On another note, they do require you to pay a minimum amount on your balance each month.

That amount can be a flat fee or a percentage of the balance they require you to pay each month in order to avoid late fees, which impacts your credit score. Make sure that you pay at least the minimum each month. Here’s a great tip: set up auto pay to ensure that you pay the minimum each month.

Will Getting a Credit Card Lower my Credit Score?

When you apply for a credit card, the card issuer will perform a hard pull of your credit history, which can cause a slight dip in your credit score. However, your new credit card account could actually be beneficial for your credit score. Firstly, as long as you don’t max out your card, it will increase your credit utilization ratio.

Secondly, as you start making payments on your new credit card account, they will be reported to the credit bureaus, which will help build your credit.

FAQs

Getting a credit card could potentially impact getting a mortgage if the card balance increases your debt to income ratio or you are late with payments, which could damage your credit score.

Your potential mortgage lender will look at your overall debt, so if you’re carrying a large balance on your credit card, it will suggest there may be affordability issues.

However, if you use the card responsibly and keep an eye on your credit utilization ratio, having a credit card could actually help to boost your credit score, and help you to get a mortgage.

Depending on how you use it, a credit card could help you to save money. If you pay your balance in full each month or have a 0% introductory rate, you could pay off outstanding debt without incurring interest. Additionally, if you are using your credit card for everyday purchases and getting cash back as a reward, you could accumulate your rewards as savings.

Yes, but the amount of time you need to wait before applying will depend on the type of bankruptcy. If you filed Chapter 13, it can take up to five years to restructure your debt, so you will need to wait until this period is over to apply for a new credit card. Chapter 7 takes up to six months for your debts to be discharged, after which point you can apply for a new credit card.

Just be aware that the bankruptcy will have had an impact on your credit score, so you will need to concentrate your application efforts on cards that are designed for those with less than perfect credit.

 

Paying down existing debt is the quickest approach to improve your credit score. Not only will this appear on your credit report, but it will also lower your credit utilization percentage. This is a percentage of your debt expressed as a percentage of your credit limit. So, if you have $2,000 in credit card debt and $6,000 in total credit limits, your credit use ratio is 33%.
To maintain a decent credit score, you should attempt to keep your credit utilization percentage around 30%.

Lorraine Smithills

Lorraine Smithills

Lorraine is a freelance finance writer with years of experience in the banking sector and after a successful career in one of the largest retail and commercial financial services providers. She has a passion for helping people with less financial confidence to get control of their money through budgeting, saving, and responsible credit practices.
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Credit Card Reviews Methodology

In order to determine the best possible credit cards, we look at things like fees, interest rates and rewards. We do this with companies that are associated with us as partners as well as other offerings. From there, we make a decision about what the best card is related to different categories and needs. We focus on interest rate cost & fees, especially the cost of carrying a balance, rewards – cards accumulate rewards in different currencies—points, miles, cash back—and their values vary widely usability – cards that accept a wide range of credit profiles and offer simple solutions for things like checking your credit score or contacting. We also consider customer reviews.

We look at cards related to good or excellent credit ratings that will then provide a range of different benefits and improvements for someone who has these scores. We also look at low fees when it comes to those who have lower credit scores.