Embarking on a journey to fortify your financial foundation in 2023? Look no further than our carefully curated selection of the 12 Best Credit Cards for Building Credit. According to data, around 60% of American adults have at least one credit card. These invaluable financial tools are far more than just bits of plastic; they're your allies on the road to achieving a robust credit history.
Whether you're starting from scratch or seeking to revitalize your credit profile, each of these credit cards offers tailored strategies and unique benefits to guide you towards financial prosperity.
But before we get into the topic, it is recommended to first read about the Secured Credit Cards for building credit in detail by Bright Money!
Join us as we explore this exclusive lineup designed to help you repair, boost, and build your credit score in the year ahead. Check out our blogs if you're looking to optimize your budget, build credit, or pay off debt.
Now, let's dive into our list of the top credit cards that can help you build or rebuild your credit in 2023. These cards are carefully selected based on their features, benefits, and potential to boost your credit score.
1. Capital One Platinum Secured Credit Card
The Capital One Platinum Secured Credit Card is an excellent choice for individuals who have little to no credit history. This card requires a refundable security deposit, which typically determines your initial credit limit. Here's why it's a great option:
- Credit Building: Since it's a secured card, it's designed to help you rebuild your credit. Your responsible use of this card is reported to major credit bureaus, helping you build credit
- Security Deposit: The security deposit serves as collateral and acts as a safety net for the card issuer. It's typically refundable when you close the account or upgrade to an unsecured card
- Credit Limit: Your initial credit limit is often determined by the amount of the security deposit you provide. Over time, with responsible use, you may become eligible for a credit limit increase
- Low Annual Fee: The Capital One Platinum Secured Credit Card usually comes with a reasonable annual fee, making it accessible to those on a budget
This card provides a straightforward way for individuals with limited or no credit history at all to start building their credit scores responsibly.
2. Discover it® Secured Credit Card
The Discover it® Secured Credit Card is renowned for its attractive rewards program, making it an enticing option for those seeking to build credit while enjoying cash back on their purchases. Here are its key features:
- Cash Back Rewards: Unlike many other secured cards, this card offers you cash back rewards on every purchase you make. This feature sets it apart and makes it highly appealing
- Cashback Match: Discover typically matches all the cash back you've earned at the end of your first year as a cardholder, effectively doubling your rewards for the first year
- Security Deposit Refund: Similar to other secured cards, Discover holds a security deposit as collateral. However, after demonstrating responsible use, you may become eligible for a security deposit refund
- Credit Monitoring: Discover provides you with access to your FICO credit score, letting you track your progress in building your credit over time
The Discover it® Secured Credit Card not only helps you establish or rebuild your credit but also rewards you for your spending, making it a compelling choice for many consumers.
3. Petal® 2 Visa® Credit Card
The Petal® 2 Visa® Credit Card is unique in that it's designed for individuals who might not have a traditional credit history. Instead of relying entirely on credit scores, Petal evaluates your financial habits, such as income and banking history, to determine your creditworthiness. Here's why this card stands out:
- Alternative Underwriting: Petal uses an innovative approach to underwriting. It considers factors like your income, savings, and spending patterns to assess your creditworthiness. This means you may qualify for this card even if you don't have a traditional credit history
- No Annual Fee: The Petal 2 Visa Credit Card typically comes with no annual fee, making it a cost-effective choice for those starting their credit journey
- Cash Back Rewards: Depending on your creditworthiness, you may be eligible for cashback rewards on your purchases, further adding value to the card
This card offers a fresh approach to credit building, making it accessible to a wider range of individuals.
4. Capital One QuicksilverOne Cash Rewards Credit Card
If your credit is fair, the Capital One QuicksilverOne Cash Rewards Credit Card is a desirable alternative. It provides the chance to raise your credit limit with responsible use and offers cashback benefits. This is why it's important to think about:
- Cash Back Rewards: Using this card, you may receive cash back on all of your purchases, which over time can add up. It's a fantastic method to recoup part of your expenses
- Credit Limit Increase: Capital One may consider increasing your credit limit after you make your first five monthly payments on time. This can improve your credit utilization and boost your credit score
- Access to Higher Credit Lines: Responsible use of this card may also open doors to unsecured credit cards having higher credit limits in the future
The Capital One QuicksilverOne Cash Rewards Credit Card is a smart choice for those looking to upgrade their credit card and enjoy cash-back rewards while doing so.
5. Citi® Secured Mastercard®
The Citi® Secured Mastercard® is an excellent option for those looking to build credit with the backing of a major credit card issuer. Here's why it's a strong contender:
- No Annual Fee: Many secured cards come with annual fees, but the Citi Secured Mastercard usually has no annual fee, making it cost-effective.
- Upgrade Opportunities: With responsible card usage, you may become qualified for an upgrade to an unsecured card in the future, further enhancing your credit profile
The Citi Secured Mastercard is a solid choice for those seeking to build credit with a well-known financial institution.
6. Discover it® Student Cash Back
64.8% of college students carry some type of credit card debt. The Discover it® Student Cash Back card is tailored for students who are looking to build credit while earning valuable cash back rewards. Here's why it's a standout choice for young adults:
- Cash Back Rewards: This card offers cash back on everyday purchases, allowing students to earn rewards while managing their finances responsibly
- Good Grades Reward: Discover rewards for students for their academic achievements by offering a Good Grades Reward. If you maintain a high GPA, you can earn a statement credit as a bonus
- Credit Education: Discover provides valuable resources and tools to help students understand credit and financial management, empowering them to build a strong financial foundation
The Discover it® Student Cash Back card strikes a balance between rewarding responsible spending and providing educational resources, thus making it an excellent choice for students.
7. Self - Credit Builder Account + Secured Visa® Credit Card
Self's Credit Builder Account paired with their Secured Visa® Credit Card offers a unique approach to credit building by combining savings and responsible credit card usage. Here's why it's a compelling option:
- Credit Builder Account: Self's Credit Builder Account functions as a savings account with a twist. You make monthly payments into the account and Self reports these payments to credit bureaus as having positive credit history. This builds your credit score over time
- Secured Visa Credit Card: The Secured Visa Credit Card complements the Credit Builder Account. It provides a traditional credit card experience, allowing you to make purchases and build credit through responsible use
- Savings Growth: As you make payments into the Credit Builder Account, you also build savings. Once the term is complete, you receive the savings, which can be a useful financial cushion
- Credit Improvement: This unique combination allows you to simultaneously build savings and boost your credit score, setting you on a path to financial stability
Self's approach is a holistic way to build credit and save money, making it an appealing choice for those looking for a comprehensive solution.
8. Chime Credit Builder Visa® Credit Card
The Chime Credit Builder Visa® Credit Card is an ideal option for individuals with limited credit history. Here's why it stands out:
- No Credit Check: Chime doesn't perform a credit check during the application process, making it accessible to those with thin or no credit profiles
- Cashback Rewards: This card offers cashback rewards on purchases, providing an incentive for responsible card usage and spending
- Automatic Savings: Chime's unique feature automatically rounds up your expenses to the nearest dollar and transfers the spare change to a savings account. This encourages savings while using the card responsibly
Chime's Credit Builder Visa Credit Card is a straightforward option for those looking to build credit without the traditional credit check process.
9. Green Dot Platinum Visa® Secured Credit Card
The Green Dot Platinum Visa® Secured Credit Card is a simple and effective tool for establishing or rebuilding your credit. Here's why it's worth considering:
- Security Deposit: You'll need to provide a security deposit, which will determine your initial credit limit. This deposit thus acts as collateral for the card
- No Frills: This card doesn't come with fancy rewards or complex features. It's designed for one primary purpose - credit building
- Low Fees: Green Dot's fees are typically reasonable, making it an affordable choice for those looking to improve their credit.
The Green Dot Platinum Visa Secured Credit Card offers a straightforward and accessible way to work on your credit score with responsible card usage.
10. First Progress Platinum Prestige Mastercard® Secured Credit Card
This Secured Credit Card is a strong choice for individuals looking to improve their credit profile. Its standout feature is its reporting to all three major credit bureaus, which can thus significantly impact your credit history. Here's why it's an excellent option:
- Triple Credit Bureau Reporting: This card reports your payment history and credit usage to all three major credit bureaus: Equifax, Experian, and TransUnion. Reporting to all three bureaus is a crucial advantage because it ensures that your positive credit behavior is recognized by a wide range of lenders and financial institutions
- Flexible Security Deposit: To open this secured card, you'll need to provide a security deposit. The deposit amount you choose will determine your initial credit limit. First Progress offers flexibility in selecting your deposit, making it accessible to a broader range of people
- Annual Fee: While this card does come with an annual fee, it's relatively competitive compared to other secured cards in the market
- Mastercard Benefits: Being a Mastercard, it provides access to various Mastercard benefits and acceptance at millions of locations worldwide
The First Progress Platinum Prestige Mastercard is a powerful tool for credit improvement, thanks to its comprehensive credit bureau reporting and flexibility in securing your credit limit.
11. Cleo Credit Builder Card by CLEO Bank
The Cleo Credit Builder Card by CLEO Bank is a valuable choice for individuals looking to establish or rebuild their credit history. This secured credit card requires a refundable security deposit, typically setting the initial credit limit. Here's why it's a wise option:
- Credit Building: As a secured card, it's expressly designed to assist you in the journey of rebuilding your credit. Your responsible usage of this card is consistently reported to major credit bureaus, which is vital for building and enhancing your credit score
- Security Deposit: The security deposit functions as collateral, providing a safety net for the card issuer. Usually, this deposit is refundable upon account closure or transitioning to an unsecured card
- Credit Limit: Your initial credit limit is often determined by the amount of the security deposit you provide. Over time, with responsible card usage, you may become eligible for a credit limit increase
- Low Annual Fee: The Cleo Credit Builder Card typically comes with a reasonable annual fee, ensuring affordability for those on a budget
This card offers a straightforward pathway for individuals with minimal or no credit history to embark on the responsible journey of building their credit scores.
12. Varo Believe Card by VARO Bank, N.A.
The Varo Believe Card by VARO Bank, N.A. is tailored for individuals looking to establish or rebuild their credit. This secured credit card requires a refundable security deposit, which typically determines the initial credit limit. Here's why it's a strong choice:
- Credit Development: Being a secured card, its primary purpose is to facilitate the improvement of your credit profile. Your responsible card usage is regularly reported to major credit bureaus, a pivotal step in bolstering your credit history
- Security Deposit: The security deposit serves as a form of collateral, offering assurance to the card issuer. This deposit is usually refundable upon account closure or when you're eligible for an upgrade to an unsecured card
- Credit Limit: Your initial credit limit is commonly linked to the amount of the security deposit you provide. Responsible financial management may lead to credit limit increases over time
- Cost-Effective: The Varo Believe Card generally comes with reasonable fees, ensuring affordability during your credit-building journey
This card provides a structured approach for individuals aiming to build or rebuild their creditworthiness responsibly.
13. BankAmericard® Secured Credit Card by Bank of America
The BankAmericard® Secured Credit Card by Bank of America is a prudent choice for individuals seeking to establish or rehabilitate their credit history. This secured credit card entails a refundable security deposit, often determining the initial credit limit. Here's why it's a favorable selection:
- Credit Progress: Functioning as a secured card, its primary objective is aiding you in the process of credit improvement. Your responsible utilization of this card is routinely reported to major credit bureaus, a pivotal factor in elevating your credit score
- Security Deposit: The security deposit acts as a safeguard for the card issuer and is typically refundable upon account closure or qualification for an unsecured card
- Credit Limit: Your initial credit limit is commonly tied to the amount of the security deposit you provide. Responsible financial management can lead to credit limit enhancements over time
- Reasonable Fees: The BankAmericard® Secured Credit Card typically carries reasonable fees, ensuring that it remains cost-effective for those on a budget
This card offers a structured pathway for individuals to enhance their creditworthiness responsibly.
14. Wells Fargo Active Cash® Card by Wells Fargo
The Wells Fargo Active Cash® Card by Wells Fargo stands out as a cashback rewards credit card rather than a credit builder card. It caters to individuals with good to excellent credit and rewards them for their spending. While it may not be designed explicitly for credit building, here's why it's worth considering:
- Cash Back Rewards: The Wells Fargo Active Cash® Card is celebrated for its cashback rewards program. It provides cashback on a variety of purchases, allowing cardholders to earn rewards while managing their finances responsibly
- Credit Limit: Unlike secured cards, this card does not require a security deposit, as it typically targets individuals with established credit histories. It offers a credit limit based on your creditworthiness and financial profile
- Credit Utilization: Responsible use of this card can help improve your credit utilization ratio, which is a crucial factor in your overall credit score
- Annual Fee: Be sure to check the terms and conditions for any associated annual fees, as they can impact the overall cost of card ownership
The Wells Fargo Active Cash® Card is suitable for those with good credit who want to earn cash back rewards while maintaining their positive credit history.
15. Sable Secured Credit Card by Sable
The Sable Secured Credit Card is designed to assist individuals who are new to credit or seeking to rebuild their credit. As a secured credit card, it requires a refundable security deposit, which often establishes the initial credit limit. Here's why it's a practical choice:
- Credit Building: Functioning as a secured card, it's structured to help you establish and strengthen your credit history. Your responsible card usage is regularly reported to major credit bureaus, a fundamental step in your credit-building journey
- Initial Credit Limit: Your initial credit limit is often linked to the amount of the security deposit you provide. Over time, prudent financial management may lead to credit limit increases
- Affordability: The Sable Secured Credit Card typically features reasonable fees, ensuring accessibility for those on a budget
This card offers a structured approach for individuals looking to establish or rebuild their creditworthiness responsibly.
16. Amazon.com Store Card
The Amazon.com Store Card is a branded credit card typically offered to Amazon.com customers. While primarily designed for making purchases on Amazon's platform, it can indirectly contribute to building credit when used responsibly. Here's a brief overview:
- Amazon Shopping: The Amazon.com Store Card is ideal for avid Amazon shoppers. It often provides special financing options and promotional offers, making it attractive for those who frequently shop on Amazon's platform
- Credit Reporting: Responsible use of this card may result in positive credit history, as some versions of the card may report to major credit bureaus
- Terms and Conditions: Carefully review the specific terms and benefits associated with the Amazon.com Store Card, including any promotional financing and interest rates
While primarily a store card, the Amazon.com Store Card can indirectly support credit building for those who regularly shop on Amazon.
17. Max Cash Secured Card by Atlantic Union Bank
The Max Cash Secured Card by Atlantic Union Bank is likely a secured credit card, often tailored for individuals seeking to establish or rebuild their credit. Here's why it's a practical choice:
- Credit Development: As a secured card, it's designed to assist you in building or enhancing your credit history. Your responsible card usage is typically reported to major credit bureaus, a vital step in strengthening your credit profile
- Security Deposit: The security deposit functions as collateral, offering assurance to the card issuer. Typically, this deposit is refundable upon account closure or when you qualify for an upgrade to an unsecured card
- Initial Credit Limit: Your initial credit limit is often determined by the amount of the security deposit you provide. Over time, responsible financial management may lead to credit limit increases
- Affordable: Secured cards, including the Max Cash Secured Card, often feature reasonable fees, ensuring accessibility for those on a budget
This card provides a structured pathway for individuals looking to establish or rebuild their creditworthiness responsibly.
Conclusion
As we conclude our exploration of the 12 best credit cards for building credit in 2023, one thing becomes abundantly clear: the path to better credit is well-paved and filled with options. The credit card landscape offers a diverse array of choices, each designed to empower individuals on their credit-building journeys.
In the coming year, whether you're focused on boosting your credit score, earning rewards while doing so, or securing a financial safety net, there's a credit card that suits your goals and aspirations. Remember, building credit is not just about the present; it's an investment in your financial future. Choose wisely, use your credit responsibly, and watch as your credit history transforms into a strong and reliable asset. The journey to better credit begins with that first step – selecting the right credit card for you. Cheers to a credit-smart 2023!
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FAQs
- What are the best credit cards for building credit in 2023?
Our list features the top 12 credit cards specifically designed to help you build your credit score this year.
- How can these credit cards help me build my credit?
These cards offer various features, such as low APRs, secured options, and credit-building tools that can positively impact your credit history when used responsibly.
- Do I need good credit to qualify for these cards?
While some of these cards are designed for individuals with less-than-perfect credit, others may require a fair to good credit score for approval.
- What should I consider while choosing a credit card for building credit?
Factors to consider include your current credit score, annual fees, interest rates, credit limits, and any specific features offered by the card issuer.
- Are there any annual fees associated with these credit cards?
Annual fees vary by card, so it's essential to review the terms and conditions for each card to understand the associated fees.
- Can I apply for multiple cards simultaneously to boost my credit score faster?
While it's possible to apply for multiple cards, it's crucial to manage them responsibly to avoid negatively impacting your credit score.
- How long does it typically take to see improvements in my credit score with these cards?
Credit score improvements can vary depending on your individual financial situation and credit usage. Consistent responsible card usage can yield positive results over time.
- What happens if I miss a payment on one of these credit cards?
Missing payments can have adverse effects on your credit score. It's essential to make payments on time and in full to maximize the benefits of these cards.
- Are there any rewards or cashback benefits with these credit cards?
While some cards focus primarily on credit-building features, others may offer limited rewards or cashback benefits. Check the details of each card to see if they align with your goals.
- Is there a specific card on the list recommended for people with no credit history?
Yes, some cards on the list are suitable for individuals with limited or no credit history, often referred to as "starter" or "secured" credit cards.
References:
https://collegefinance.com/research/college-student-debt-and-credit-card-usage
