Have you ever been declined for a credit card due to a lack of credit history? It’s a perplexing situation: needing credit to get credit. Fortunately, there are credit cards tailored for those with no credit history. Let’s dive into some top picks for young adults.
Top 2 Credit Cards for Young Adults with No Credit
| Card | Intro Offer | APR | Annual Fee | Required Credit Score |
| Petal® 2 “Cash Back, No Fees” Visa® Credit Card | N/A | 17.99% – 31.99% Variable | $0 | Excellent, Good, Limited History, No History, Limited, No Credit |
| Capital One Quicksilver Student Cash Rewards Credit Card | Earn $50 Cash Back when you spend $100 in the first three months | 19.99% – 29.99% (Variable) | $0 | Average, Fair, Limited |
Best Credit Cards for Young Adults with No Credit
1. Capital One Quicksilver Student Cash Rewards Credit Card
This card is perfect for students embarking on their credit journey. With a $50 cash back after spending $100 in the first three months, it’s a great starter. You’ll also earn 10% cash back on Uber and Uber Eats, 5% on hotel and car rentals, and 1.5% on other purchases. And guess what? No annual fee!
2. First Latitude Secured Mastercard® Credit Card
Ideal for those who prioritize a low-security deposit, this card offers 1% cash back on payments. Secured with a deposit between $100 and $2,000, it can act as your credit stepping stone. There’s a $25 annual fee for the first year and $35 thereafter.
3. Amazon Secured Card
If you occasionally carry a balance, this card’s 10% fixed APR will be a blessing. By depositing at least $100, you can earn 2% back on Amazon.com purchases if you’re an Amazon Prime member.
Pros and Cons of Credit Cards for No Credit
Pros:
- Easier approval process.
- Built-in tools to monitor credit scores.
- Excellent platform for initiating credit-building.
Cons:
- Typically low credit limits.
- Potentially higher APRs.
- Limited to no introductory offers.
How to Make the Most of Your Starter Card?
1. Understand Secured Cards
A starting step in building credit might involve making a deposit. Secured cards require a security deposit, usually around $200. This not only establishes credit but can help raise your score over time. The Discover it® Secured Credit Card, for instance, is notable for its cashback offers and no annual fee.
2. Shop Around Before Applying
Before committing, study interest rates and fees. Opt for cards without annual fees and remember that applying frequently can slightly lower your credit score.
3. Always Pay Your Bill on Time
To avoid high-interest rates, pay your bill in full and on time. Most cards offer a grace period, so understand this timeframe and consider setting up autopay.
4. Monitor Your Credit Limit
Stay below 30% of your credit limit to maintain a good credit score. As your credit limit grows, consider requesting a higher limit but spend wisely.
Choosing Credit Cards With No Credit
Starting on your credit journey without prior experience can be daunting. But, with resources from financial experts and an understanding of your goals, you can make an informed choice. It’s key to opt for a card that reports to all major credit bureaus. This establishes a broad-based credit history. Ideally, your first credit card shouldn’t have an annual fee and should be kept active to aid in increasing the age of your credit history. Proper research ensures that your first credit step is a leap toward financial stability.
Takeaway
Credit is a double-edged sword. While it can be a gateway to numerous benefits, misuse can lead to financial quagmires. Tread with caution, build responsibly, and the world of credit will serve you well.
Frequently Asked Questions
1. Can I get a credit card if I have never had credit before?
Student credit cards are becoming popular among young adults. If you’ve never had credit before, you’ll need to start building your credit history. One of the best ways to do this is by getting a credit card specifically designed for people who are new to credit. There are several options available, including secured credit cards, student credit cards, and credit cards for people with no credit. Once you have a card, make sure to use it responsibly and pay it off in full each month to build a positive credit history.”
2. Is 0 credit good or bad?
Zero credit is preferable to bad credit. While both can be impediments, people with no credit might find acquiring top-tier credit cards challenging. On the flip side, bad credit can hinder various applications, from credit to apartment rentals. The solution? Understand credit-building fundamentals and commence your journey towards excellent credit.
3. How can I build my credit fast?
- Strategically Pay Credit Card Balances: Keeping credit utilization under 30% is ideal. Top scorers often maintain single-digit utilization. Ensure low balances during billing cycles for optimum scores.
- Always Pay Bills On Time: Consistency is key. Late payments can tarnish your credit report for up to 7½ years. If you lag by 30 days, settle immediately and request the creditor to stop reporting the delay.
