Best Credit Cards for Building Credit

Best Credit Cards for Building Credit

One of the hardest journeys one can take is building a great credit profile. People who are just starting on this journey or those trying to rebuild their credit after falling off the path due to a financial mistake, often struggle as they try to get a decent credit score.

Why is a great credit history important? Well, without one you’d be missing out on various financial benefits as well as fiscal wellbeing.

From landlords to lenders, everyone relies on credit reports in order to understand what you’re like. The information housed within our credit reports play an important role in the decisions we make all through life. Life events, like getting a new apartment or getting a new job, are highly dependent on how good your credit is.

For many individuals wishing to start this journey, the easiest way is to get a credit card. Regardless of what popular opinion says about them, card issuers are more than happy to help you get your credit to a good place.

In fact, the hardest part of this whole process is simply identifying what issuer to go with.

To help you out we broke down the cards into three categories:

  • Students
  • No/Limited Credit
  • Bad Credit

1.Student Cards Ideal for Building Credit

Although colleges and universities are usually where you prepare for your professional future, it is clear that students get more than an education with their degrees. Individuals also have an opportunity to gain real world experience, such as getting jobs and paying bills.

This is why your college years are the best time for you to begin your credit-building journey and learn the best practices on how to act when you are offered credit. This is why multiple credit card issuers have designed cards built specifically to help students out. The cards listed in this category have no annual fee and give back cash as a form of reward incentive.

Discover It Student Cash Back

With the Discover It Student card, Discover automatically matches all the cash back earned at the end of the first year without any limit and no need to sign up. Up to 5% can be earned back at different places every quarter like gas stations, Amazon, grocery stores and even restaurants. To support getting good grades, there is also a $20 statement credit every year as long as your GPA is 3.0 or higher for five years.

Also, Discover does not have an annual fee, no late fees on your first late payment, as well as no APR change when you pay late. There is also a Freeze It Switch which can be used to block any purchases or transfers from your account in a manner of seconds.

Finally, Discover provides 100% U.S based customer service, and users can get their free Credit scorecards with their FICO credit score.

Journey Student Rewards From Capital One

This card offers 1% cash back on every purchase made. If payments are made on time, your cash back is increased to 1.25% for the month. There is no annual fee on this credit card and no foreign transaction fees. You also get to enjoy access to a higher credit line after meeting your payments for five months. You can also monitor your profile for free with the CreditWise app. Finally, there is no fraud liability should your card be stolen.

  1. Credit Cards for Building Credit

A common misconception is the idea that in order to get credit, you already have to have credit. The reason for this is because your credit report is used to determine your risk, and this is why people without a decent credit history will struggle to secure a mortgage.

The good news is today, several credit card issuers offer cards that are easy to get. These cards are the perfect way for people with bad or no credit history to stage a comeback.

Capital One Platinum Card

Like the other cards mentioned earlier, using this card makes you exempt from paying any form of annual fees. You also get access to a better credit line after meeting your first five monthly payments on time. Capital One provides fraud coverage should your card be lost or stolen, and you also have access to the bank’s mobile application to access your account. Finally, this card allows you to pay online, by check, or at the nearest branch to you with no fee attached.

  1. Secured Credit Cards

Being able to qualify for things like a mortgage, a loan, or even getting a new job can be very difficult to without having a great credit history.

The card issuers in this category allow everyone, including those with a bad credit history, to get a credit card. Here are our top picks:

Fingerhut Credit Account

The first benefit of having a Fingerhut credit card is how fast it takes to get a credit decision. The application is really easy, and you are spared the agony of making endless trips to your issuer. You can use your line of credit to shop from any brand you want. This account is also characterized by the low monthly payments you would have to make if you get accepted for a Fingerhut Credit account issued by WebBank.

Capital One Secured Mastercard

Like the other cards featured on this list, this card has no annual fee, and you retain all the credit building benefits, given you use the card responsibly. This card automatically builds credit, and it reports to the three major credit bureaus.

The initial credit line is $200 after a deposit of either $49, $99 or $200 is paid. The deposit amount is determined as soon as the bank assesses your creditworthiness. Also, you get access to a higher credit line once you keep up with your payments for five months in a row without having to make any additional deposit.

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Posted in Credit Card
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