Best First Credit Cards for Beginners in December 2024

Getting your first credit card is a momentous occasion, and the fact that you’re doing research about which card to start with is a good omen for your financial future.

Many people begin their credit journey by applying for the first card offers that hit their mailboxes or jumping at card-signup discount offers from retail stores. While those aren’t necessarily bad ways to begin with credit, it’s easy to miss out on getting a starter card with the best perks.

When you’re a beginner, it’s also easy to get rejected for a card and accidentally hurt your credit score by triggering an unnecessary hard inquiry into your credit. Starter cards are designed to solve this problem and help you get access to credit even if you have no credit history or a very thin credit file.

Note that when you’re just starting out, most credit issuers will view you as a risky borrower and won’t be willing to offer you huge credit limits, low interest rates, and the perks and rewards that come with premium cards. But that’s OK. Provided you carefully apply for your first credit card and use it responsibly, you’ll get access to better cards before you know it.

Best starter credit cards

These entry-level credit cards are a good choice for anybody just starting their financial journey. A good starting credit card helps you build your credit by reporting your account history to all three major credit reporting agencies while also keeping fees and interest rates low. Take a look at what our experts have chosen as the best starter credit cards.

Best secured starter credit card

Best unsecured (no deposit) starter credit card

Best credit card for beginners

Best starter card for students

Best first credit card with no annual fee

Best first credit card with high approval odds

Best first credit card for building credit

How do you get your first credit card?

Getting your first credit card isn’t actually too difficult if you’re careful about which card you pick. Just follow these steps:

1. Confirm your eligibility

If you’re employed and have a steady source of income, it’s easy to get your first credit card. To meet its eligibility requirements, you must:

• Be 18 years or older to apply
• Have a valid Social Security number
• Prove to the card issuer that you can afford the expenses

If you have substantial savings or someone regularly transfers money to you, you may qualify even if you don’t have a job. If your income and savings aren’t substantial, you’ll have better chances of approval if you apply for a good secured credit card. Because of the nature of how secured credit cards work, you need to make a security deposit (which will act as your credit limit). If you don’t pay your bills, the credit issuer will simply claim your deposit as collateral, reducing the risk on their end.

2. Consider your options carefully

After you confirm your eligibility, it’s important to think carefully before choosing your first card. You’ll want to avoid:

• Getting rejected: Each application will trigger a hard inquiry into your credit report, resulting in a small penalty to your credit score. Too many hard inquiries in a short time will cause your score to plummet and your future credit card applications may be denied, so you don’t want to carelessly apply for cards you might not get.
• Unfavorable terms: Some cards prey on ignorance, requiring you to pay unnecessary fees and abnormally high interest rates. Review the advantages and disadvantages of each card you apply to, as well as their terms of agreement.

3. Submit your application

The application process for most credit cards is straightforward and generally amounts to filling out a form online or in person. There’s a good chance you’ve received advertisements for credit cards by mail or been asked to sign up for a credit card when checking out at a retailer.

4. Finalize all requirements

If you apply for a secured credit card as your starter card, you’ll need to pay the deposit before you receive it or risk being rejected. With an unsecured credit card, if your application is accepted, you’ll simply receive the card in the mail. Then just follow the instructions to activate your card (which usually involves calling an automated phone number, then entering in your card details and a pin number).

5. If you’re denied: attempt to apply for another card

Before applying for a different card, first make sure you understand why your application was rejected. The card issuer will usually provide you with a reason—for instance, you might have insufficient credit history, or a credit score that’s too low. Once you understand the reason, pick a different card that you’re more likely to be approved for. For instance, you can look for a credit issuer that doesn’t perform credit checks.

A good rule of thumb is to send out an application once every two weeks until you successfully get a card. However, if you’re careful about which cards you apply for, one application should be more than enough.

What should you look for in a starter credit card?

Before choosing your starter credit card, there are a few key considerations to keep in mind. Be on the lookout for the following:

• Account reporting to the three main credit bureaus: When your credit issuer reports to Experian, Equifax, and TransUnion, it lets you maximize the credit history you’re building with your card and helps you graduate to better credit cards in the future.
• Affordable security deposits: If you’re applying for a secured credit card, you don’t need a huge credit limit. This means you should look for a card with a reasonable minimum security deposit.
• Low or no processing, maintenance, or annual fees: Credit card fees are only worth it if you get rewards and perks that offset the cost. With starter cards, you don’t get many perks, so paying for fees is useless and unnecessary.
• Low APR: Unfortunately, high APR credit cards are usually unavoidable if you have no credit or a bad credit score. As a result, you’ll want to diligently pay off your balance each month to avoid costly rollovers that tack on high interest payments.

What all of that boils down to is that you should look for an affordable credit card that helps you build your credit while giving you a low-cost opportunity to understand the basics of how credit cards work.

How can you build credit with your first credit card?

As a new credit card owner, knowing how to build your credit score is particularly important. To do so, choose a card that has few fees and reports to the three major credit agencies. This both makes it easier to pay your bills on time and maximizes the benefits you’ll see for doing so. Building credit takes time, but consistency pays off: If you manage your account well for a year, you should start to see your score rise.

Here’s how to use a credit card responsibly and manage your account well:

1. Don’t spend too much on your credit card

Although using your credit card can build your credit, you shouldn’t use it extensively. That may seem counterintuitive, but it’s the cornerstone of responsible credit use. You should view your credit card as a helpful tool, not as a license to go on a spending spree.

That’s because credit utilization, or the percentage of your overall credit limit that you use, has a significant impact on your credit score. Try to stay below 30% of your limit. For example, if you have a $1,000 card limit, you shouldn’t spend more than $300 on it per month (because $300 is 30% of $1,000). It’s even better to keep your utilization in the single digits if you can. It makes lenders nervous if you’re constantly maxing out or overusing your credit.

2. Always pay your bills on time

It’s very important to make all of your payments on time. Even one late payment can damage your credit, and a consistent history of overdue payments is very harmful. Nonpayments (i.e., debts that you just never pay off) are even worse for your credit score, not to mention your mental health when debt collectors come knocking.

3. Avoid accumulating debt from interest

Paying interest itself doesn’t hurt your credit score, but when you can’t pay back your debts, or pay them on time, that’s when your credit score will take severe damage. Here’s how that might happen.

Interest scenario

Every month, your credit card company will ask you to pay a minimum amount on the charges you’ve made to your credit card. If you spend $200, they may ask you to pay $15 dollars of it at minimum. If you don’t pay off the entire bill, you’ll owe interest on the remainder.

Imagine you only pay $100 of the $200 you owe, meaning you still owe $100. If your interest rate is 20%, you’ll owe an additional $20 on top of the $100 you owe, or $120 in total. That’s because $100 x 20% is $20.

Now imagine you’re spending thousands of dollars on your credit card and not paying it off. Your interest charges will be hundreds of dollars every month, and you’ll quickly begin accumulating debt you can’t pay back.

Don’t open the gateway to poor finances by paying credit card interest. Use your starter card responsibly, build up your credit, and save for your future.

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