What Are The Best Starter Credit Cards? 6 Options For Those New To Credit
Applying for your first credit card is a major milestone in the financial lifespan of any individual. If you're a young adult, undergraduate, or just someone who has never had a credit card before, it's easy to feel lost at sea when you've got to pick one card out of 200+ options. After all, the consumer is left having to parse through APRs, annual fees, rewards, transaction fees – the list goes on and on. So where do you begin? We have compiled this guide so that people starting out on their credit journey can make informed decisions in their first credit card.
Best Starter Credit Cards For...
- First Timers: Discover it® for Students
- College Students: Journey® Student Rewards from Capital One®
- No Credit Card History: Discover it® Secured Card - No Annual Fee
- Travel: BankAmericard Travel Rewards® for Students
- Cash Back: BankAmericard Cash Rewards™ for Students
- Immigrants & Permanent Residents: Deserve® Edu Mastercard For Students
The Best Starter Credit Cards
The following are some of the best credit cards available to first time credit card applicants – from college students to consumers with bad credit.
Best Credit Card for First Timers: Discover it® for Students
The Discover it® for Students is one of the best first credit cards you can apply for. The thing that makes this card standout among all similar offers is that it doesn't penalize you for having a limited credit history. The cash back rewards you get from this card are on par with the top offers available to seasoned credit card users. You get 5% cash back in categories that change each quarter like gas, restaurants, wholesale clubs and more, up to the quarterly maximum when you activate. Furthermore, for new cardmembers, Discover will double all the cash back you receive at the end of your first year. That effectively makes the card's rewards rate at at least 2% during that first year. This is a level of savings that can’t be matched, especially not by other starter credit cards.
As with all Discover credit cards, the Discover it® for Students allows cardholders to track their FICO® score. This can be an invaluable asset, especially for a first credit card. Monitoring and tracking your credit score can help inform your future lending decisions. You will also be able to get a sense of how your financial behavior impacts your credit score. For example, when you charge up your credit card to the brink of its limit, you score may go down. Seeing these types of things in action can help Discover it® for Students cardholders establish a firm understanding of credit.
Highlights
- $0 Annual Fee
- Discover matches all the cash back you've earned at the end of your first year - automatically. Only for new cardmembers
- Earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants or Amazon.com up to the quarterly maximum each time you activate. Plus, 1% cash back on all other purchases.
Best Starter Credit Card for Recent Graduates: Journey® Student Rewards from Capital One®
The Journey® Student Rewards from Capital One® is a fantastic starter credit card, especially for students who love to travel abroad. Most U.S. credit cards charge a fee whenever they are used on foreign soil. The Journey® Student Rewards from Capital One® waives these charges and allows people to simply use their card whenever they travel, fee-free. This is a good option for students who are studying abroad and want to have an emergency card to supplement their budget.
Journey® Student Rewards from Capital One® users earn 1% cash back on all their purchases, and 1.25% whenever you pay on time. While you can get a higher rewards rate through other beginner credit cards, this is a good option for people with non-standard spending habits. Most other cards typically provide you with rewards on things like travel, grocery stores or restaurants. If you tend to shop at other types of establishments, this card can be significantly more beneficial than the other cards on this list.
Highlights
- No annual fee
- 1% cash back on all your purchases. Pay on time to boost your cash back to a total of 1.25% for that month
- No foreign transaction fee
Best Starter Credit Cards for Those With No Credit History: Discover it® Secured Card - No Annual Fee
The Discover it® Secured Card - No Annual Fee is designed for people with no credit or bad credit, making it a good first credit card for most people. Despite that, this card doesn't pull any punches when it comes to rewards. Unlike most secured credit card users, Discover it® Secured Card - No Annual Fee users can earn cash back for their purchases. You get 2% cash back at restaurants or gas stations on up to $1,000 in combined purchases each quarter, and 1% back on everything else.
The only catch behind this credit card is the fact that you must put down a security deposit to open an account. This is used as collateral by the issuer, in case you don't pay back your balance. That is a standard feature of all secured credit cards. Your credit limit on the card will be equal to however much you deposit. The minimum required deposit on this card is $200.
Highlights
- $0 Annual Fee
- 2% cash back at restaurants or gas stations on up to $1,000 in combined purchases each quarter
- Reports to all 3 major credit bureaus
Best Starter Credit Cards for Young Adults: BankAmericard Travel Rewards® for Students
