7 Best First Credit Cards to Build Credit this Month
Looking for a great first credit card? We'll show you the best options and help you make an informed decision.
Table of Contents
- Types of Credit Cards
- 7 Best First Credit Cards For Building Credit
- What to Consider When Choosing a Credit Card
- How to Apply
- Tips for Building Credit with a Credit Card
- Final Thoughts
Having a first credit card is an important step in the process of financial maturity, as it will help teach you how to manage your finances, and having a positive credit score can be beneficial when it comes to getting a loan, buying a car, or renting an apartment. Therefore, it is important to choose the best first credit card from all the ones out there, so you can reap the maximum benefits while building a good credit history.
A credit card is basically a loan where the card issuer acts as the lender and you act as the borrower. It can be an essential tool to help build and manage your credit if used correctly, but it can be hard to know which type of credit card is right for you.
When selecting a first-time credit card, it’s important to consider several factors, such as annual fees, interest rates, rewards programs, and other perks. In this article, we’ll take a look at some of the best credit cards for first-time users, based on the factors mentioned. We’ll also provide advice to help you find the right card for your needs and maximize the benefits of having a credit card.
Types of Credit Cards
The first step towards making the best choice when it comes to choosing the right credit card is understanding the different types of credit cards available.
Secured credit cards
A secured credit card requires a cash deposit that acts as collateral and sets the card’s spending limit. These cards are designed to help users build or rebuild their credit history, as they generally have low limits and do not usually offer rewards.
Pros: easy to qualify for, even with poor or no credit history.
Cons: deposit may be difficult to pay, and they may not offer rewards or incentives.
Unsecured credit cards
One of the most common types of credit cards, unsecured credit cards are not backed by a deposit. They have higher spending limits and rewards but may require a good-to-excellent credit history to qualify.
Pros: possibility of earning rewards or cash back, higher spending limit.
Cons: usually requires good to excellent credit score to qualify.
Student credit cards
This type of credit card is designed for students who may not have an established credit history. They typically come with lower spending limits and may offer rewards or incentives, although they usually require a cosigner to be approved.
Pros: possibility of earning rewards or cash back; low spending limit makes it easier to manage.
Cons: cosigner required to be approved; may not be able to get the same rewards as other cards.
Retail credit cards
Retail credit cards are issued by a specific retailer and offer rewards or incentives for customers who use the card to make purchases. These cards may come with introductory financing offers and exclusive discounts and promotions.
Pros: possibility of earning rewards, special discounts and promotions; introductory financing offers can help you save money in the long run.
Cons: may have higher interest rates compared to other credit cards; exclusive rewards and discounts are only valid with that particular retailer.
7 Best First Credit Cards For Building Credit
Consider any one of these credit cards for first-time users.
|Lender||Scholaroo||Our view||APR Rate %||Minimum Credit Score||Learn more|
Discover it® Student Chrome
|Best choice overall for students||17.74% - 26.74%||Not required||Visit website|
Capital One Platinum Mastercard
|Best for fair credit||16.99%–25.99%||580+||Visit website|
Discover it® Student Cash Back
|Good for students with no credit||13.99%–22.99%||Not required||Visit website|
Citi Double Cash Card
|Good rewards||15.74%–25.74%||690+||Visit website|
Chase Freedom Flex
|Low interest rates||14.99%–23.74%||690+||Visit website|
Bank of America® Travel Rewards
|Best for travel rewards||15.24%– 25.24%||670+||Visit website|
OpenSky Secured Visa
|Best for building credit||17.39%||None (security deposit)||Visit website|
#1 Discover it Student Chrome
This is a card designed specifically for students and it requires no credit to apply. Discover considers that students generally do not have a long credit history or a good score to begin with. Therefore, even if you do not have good credit, you can still get this card easily.
Benefits and Rewards: No credit is required to apply, 0% introductory APR on purchases for the first 6 months, 1% cash back on all purchases, cashback bonus after the first year equal to all the cash back rewards earned that year
Fees and Interest Rates: No annual fee, no foreign transaction fees, and a variable APR of 17.74% – 26.74%.
Minimum Credit Score Required: No credit score required to apply. However, good credit can get you lower rates.
#2 Capital One Platinum Credit Card
This is a great card for first-time credit users, as it provides access to a variety of features and benefits such as low interest rates, no annual fee, and no foreign transaction fees.
Benefits and Rewards: 0% introductory APR on purchases for the first 15 months, 1% cash back on all purchases, and access to credit education tools.
Fees and Interest Rates: No annual fee, no foreign transaction fees, and a variable APR of 16.99%–25.99%.
Minimum Credit Score Required: Fair (580) to excellent credit (690) is recommended. They accept limited credit history of less than 3 years.
#3 Discover it Student Cash Back
This is a credit card that is designed specifically for students, offering a range of rewards that make it an ideal choice for first-time credit users. This one also does not require a credit score to apply.
Benefits and Rewards: No credit is required to apply, 5% cash back on rotating bonus categories, 1% cash back on all other purchases, no late fee on the first late payment, and $20 statement credit after the first purchase.
Fees and Interest Rates: 0% APR for six months on purchases, no foreign transaction fees, and a variable APR of 13.99%–22.99%.
Minimum Credit Score Required: No credit score is required to apply. But good to excellent credit (690) is recommended to get lower rates.
#4 Citi Double Cash Card Credit Card
This is another best first credit card option that is great for first-time credit users who want to build their credit and earn rewards.
Benefits and Rewards: 2% cash back on all purchases, 0% introductory APR for 18 months on balance transfers, 1% cash back when you pay off the purchase, and access to Citi’s concierge service.
Fees and Interest Rate: No annual fee, no foreign transaction fees, and a variable APR of 15.74%–25.74%.
Minimum Credit Score Required: Good to excellent credit (690) is recommended.
#5 Chase Freedom Flex Credit Card
This card is a good choice for first-time credit users as it offers rewards on everyday purchases and access to a variety of benefits.
Benefits and Rewards: 5% cash back on rotating bonus, 3% cash back on and drugstore purchases, 1% cash back on all other net purchases, 0% introductory APR for 15 months on purchases, and access to Chase Ultimate Rewards.
Fees and Interest Rates: No annual fee, no foreign transaction fees, and a variable APR of 14.99%–23.74%.
Minimum Credit Score Required: Good to excellent credit (690 +) is recommended.
#6 Bank of America Travel Rewards Credit Card
This card is a great choice for first-time users as it provides flexible rewards and no annual fee.
Benefits and Rewards: 1.5 points for every $1 spent on all purchases, 25% bonus when you redeem your points for travel-related purchases, 0% introductory APR for 12 billing cycles on balance transfers, and access to Bank of America’s Preferred Rewards program.
Fees and Interest Rates: No annual fee, no foreign transaction fees, and a variable APR of 15.24%– 25.24%.
Minimum Credit Score Required: Good to excellent credit (670 +) is recommended.
#7 OpenSky® Secured Visa® Credit Card
This card is a great choice for those with a limited or no credit history looking to build their credit, as it allows for flexible payments and rewards like cashback. However, there is an annual fee and upgrade options are limited.
Benefits and Rewards: No credit check required, no minimum credit score needed, access to a variety of tools to help build your credit, 1% cash back on all purchases, 0% APR for 18 months on balance transfers.
Fees and Interest Rates: Annual fee of $35 per year, no foreign transaction fees, and a variable APR of 17.39%.
Minimum Credit Score Required: None required. (must have a valid Social Security Number). As a standard though, 650 or higher is advised for better rates.
What to Consider When Choosing a Credit Card
Once you understand the types of credit cards available and have gone through the list of the best first credit cards, it’s time to choose one. It can be a bit confusing to choose from the best options available. Take note of the following factors to help you choose the one that works best for you based on your needs:
Determine Your Spending Habits
Taking a look at where you currently spend your money can help you determine what type of credit card is best for you: Will you be using your credit card on everyday purchases or for bigger expenses? Knowing this will help you decide which features are important and which ones aren’t worth looking into. It will also help you decide on your credit card limit, which is the amount you are able to borrow from the bank or lender. Choose a card with a credit limit that is suitable for your needs so you don’t end up maxing it out.
Check Your Credit Score
Your credit score plays a big role in what type of credit card you’ll be approved for, so it’s important to check your credit score ahead of time. This will give you an idea of what type of credit cards are within reach and which ones might require more work on your end. Each credit card has a different set of requirements for approval and having a good to excellent credit score will increase your chances of being approved. There are also credit cards available that may not need a credit score. Regardless, make sure to check the minimum credit score requirements before you apply.
Compare Interest Rates and Annual Fees
The interest rate is the amount you will pay for borrowing money, whereas the annual fee is the amount that you pay for the credit card on a yearly basis. Some credit cards have no annual fee, while others may have a fee of up to several hundred dollars. The interest rate and fees associated with a credit card can make or break your decision so it’s important to compare the interest rates and annual fees of different credit cards – this will help to determine which one will cost you the least amount of money over time. Additionally, take note of any late fees that may apply. Where possible, opt for a credit card that has a low or even zero-interest rate, depending on your credit score, and read the fine print in order to find one with competitive rates or no annual fee at all.
Consider Rewards Programs and Benefits
There are a large number of credit cards that come with reward programs and other benefits that can save you money on purchases or provide discounts – all with the purpose of incentivizing new users. These can range from cash back, travel points, and access to certain events amongst other perks. In some cases, introductory offers might also be available for even greater savings. Be sure to research the rewards programs of each credit card before signing up to make sure it’s the best one for your needs in order to maximize the value of your card.
Look for Introductory Offers
When shopping around for a credit card, look out for introductory offers that might be available. These can provide great savings in the form of lower interest rates and waived fees, so take note of any offers you come across during your search. By taking advantage of these offers, you can save money and make the most out of your first credit card.
How to Apply for the First Credit Card
The process of applying for a credit card for the first time is relatively straightforward.
Take note of the following requirements in order to apply for a credit card.
- Be at least 18 years old
- Have a valid government-issued ID or Social Security Number
- Have an income (which can include a part-time job, allowance from parents, or student loan)
- Demonstrate responsible use of credit
Steps to Apply
When applying for a credit card for the first time, you can expect to follow these steps:
Step 1: Gather Documents
Before you can apply, you will need to have some documents handy that may include the following:
- Proof of identity such as a passport or driver’s license.
- Proof of address such as a utility bill or phone bill.
- Employment information such as pay stubs or tax returns (if applicable).
- Bank statements or other financial documents (if applicable).
- Authorization for a credit check (if required).
Step 2: Compare Offers
Look through different credit card offers to find the one that best fits your needs. Make sure you compare things like Annual Percentage Rates (APRs), bonuses, rewards, and fees associated with credit cards.
Step 3: Fill Out the Application
Once you’ve chosen a credit card, fill out the application form. This will usually involve entering your personal information, such as your address, date of birth, and current employment status.
Step 4: Submit the Application
After you’ve filled out the application form, make sure to double-check it for accuracy before submitting it. Having done that, all you need to do is wait for a response from the lender.
Tips for Building Credit with a Credit Card
Once you’ve decided on your ideal credit card, use these tips as a guideline to help you get the most out of your credit card.
Keep Track of Your Spending
Keeping tabs on your purchases lets you manage your spending and make sure you’re staying within budget.
Pay Your Balance On Time and In Full
Paying your balance in full every month keeps your credit utilization low, which is beneficial for building good credit. Additionally, always make sure to pay your balance on time, as late payments can negatively affect your credit score.
Avoid High Balances and Limit Credit Utilization
Keeping a low credit ratio (the amount of available credit you are using) is important for maintaining a healthy credit score. Aim to stay below 30% usage at all times.
Monitor Your Credit Score Regularly
Checking your credit score regularly helps you avoid unnecessary fees and stay on top of changes to your score. This allows you to make sure your first credit card is helping build a strong financial foundation.
Here are some frequently asked questions regarding getting the best first credit card:
What kind of credit card should my first one be?
For your first credit card, it’s usually best to go with a secured or low-limit credit card that will help you build your credit history.
When should I first get a credit card?
You should consider getting your first credit card as soon as you can handle the responsibility of making regular payments and taking on debt responsibly.
Is it good to have a credit card and not use it?
Yes, it can be beneficial to have a credit card and not use the amount on it by adding money on top of the limit. Doing this shows potential creditors that you can manage your finances responsibly because you don’t owe money, which in turn will help increase your credit score over time. If you don’t use your credit card at all, the bank could close the account due to inactivity, which could have a negative effect on your credit score.
Credit cards can help establish a good credit score by allowing borrowers to demonstrate their ability to manage debt responsibly. Consider your needs when choosing the right card so you can get the most out of it. Be sure to read the terms and conditions before applying for it and make sure you can meet the minimum credit score requirements. A good first credit card should provide rewards, benefits, low fees, and a low interest rate that fits your needs. Once you’ve chosen your ideal first credit card, start using it responsibly to establish a solid financial foundation and move towards achieving your long-term goals. With the right attitude and planning, you can maximize the benefits of your credit card while avoiding costly mistakes.