Whether you’re new to credit, seeking to finance a new purchase, pay down some debt or get rewarded on your spending, we have top card recommendations for you.
My colleague recently shared with me a question he’d received from our reader, Diana:
“Can you give me a clue of which credit card would be best for me? I am trying to build my credit to buy a home in the future. My score went up 34 points, I’m happy about that. My score’s at 654 right now. I would like a credit card with a low interest rate if possible. What would you recommend? I only have one credit card with a $300 credit limit. I’m almost finished paying it off. I only have a $100 left to pay.”
First things first, good job increasing your scores and setting such an amazing goal as homeownership, Diana! Continue paying down your card – you want your credit utilization (how much of your credit line you’re using) to be under 35% at all times. And make sure to ask for a credit limit increase to make that easier.
The biggest favor you could do yourself is to never carry a balance, since cardholders with fair FICO scores (under 670) can rarely count on low APRs, no matter the card.
As for the best card for you, I often get this kind of question from my friends – especially those in their twenties, who are either just starting out to build their credit or working on improving it after a few mistakes they’ve made. Since I’m a big credit card nerd, I love helping them out – and I’ll gladly help you out too.
In this article, I’m going to share the best credit cards for young adults, whether they’ve reached the good credit threshold or, like Diana, are only just getting there.
Secured Mastercard® from Capital One: Best for young adults with low credit scores
Many young people may find it hard to qualify for the majority of credit cards when they’re just starting their credit journey or if their credit scores are on the low side. In this case, a secured credit card is a good option. It’s called “secured” because you need to secure it with a deposit to get approved. Typically, the deposit becomes your credit line.
My recommendation here is the Secured Mastercard from Capital One. I may be a bit biased because this was the secured credit card I’d chosen, but I couldn’t be happier with it. The initial security deposit is low (up to $200, depending on your credit), and you get a $200 credit line to start.
You can get access to a higher credit line after six months of on-time payments without paying more toward the deposit, which is a requirement many other secured cards have. There’s also no annual fee.
Additionally, the Capital One Secured is easy to upgrade. True story: After a year and a half of card membership, my credit limit was raised from $500 to $1,500 automatically. That led me to believe that Capital One was happy with me. So, I called the issuer and asked if I could upgrade, and after a five-minute conversation, my secured card was upgraded to the cash-back earning Capital One Quicksilver Cash Rewards Credit Card.
It’s important to note, though, that Capital One doesn’t offer a standardized schedule for upgrading from this card, so my experience might not be true for everyone. Even taking this into account, the Capital One Secured is still a solid choice for building your credit when it’s not in the best shape.
Discover it® Student Cash Back: Best for studentsIf you’re working on your degree, why not work on building your credit at the same time? The Discover it Student Cash Back card is a starter credit card designed for students with no credit history, and it offers you an opportunity to learn how to use credit while you complete your college education. Plus, you’ll earn cash back rewards.
The Discover it Student Cash Back card comes with a number of benefits, including no annual fee and no late fee on your first missed payment (after that, up to $40). (But please, don’t make late payments a habit. Trust me.)
You can also earn 5% cash back on rotating categories that you enroll in each quarter – for up to $1,500 in purchases per quarter, then 1% – so go ahead and buy all the study snacks you can afford. You’ll earn 1% cash back on all other purchases, as well as a $20 Good Grade Reward every year you keep your GPA above a 3.0 (for up to 5 years). If it’s your first year as a cardholder, you’ll also get Discover’s famous Cashback Match.
See related: How to build credit as a college student
Chase Freedom Unlimited: Best for flat-rate cash back
When you’re in fair credit territory, more credit card possibilities become open for you, including cash back credit cards.
There are a few 1.5% cash back credit cards on the market, and they all can bring simplicity and solid rewards into your cash back game. For this purpose, they’re all great options, but I’m picking the Chase Freedom Unlimited in this category because when it comes to credit cards, you need to think long game.
The Chase Freedom Unlimited can help you enter the world of Chase Ultimate Rewards, one of the most valuable reward currencies in the credit card market. This means that you can use your cash back as points that can take you far if you love traveling. Further down the road, as your scores improve, you can get the Chase Sapphire Preferred® Card or Chase Sapphire Reserve® and get even more value out of your rewards, as well as some amazing travel perks.
Not too bad, right? Besides the 1.5% cash back on general purchases and a ticket to the world of travel rewards, the Chase Freedom Unlimited will also get you:
- 5% cash back on Lyft purchases (through March 2022)
- 5% cash back on travel purchased through Chase Ultimate Rewards
- 3% cash back on dining
- 3% cash back on drugstore purchases
Discover it® Cash Back: Best for bonus cash back
While we’re still in the fair credit territory, I’d like to also recommend Discover it Cash Back. Technically, it requires a good credit score, but I was able to get it with a FICO score of 660 based on Experian data. Although that might have something to do with the fact that I also have a savings account with Discover, it’s still proof that you may have a chance to get approved with fair credit.
Like the student version of the card, the Discover it Cash Back earns 5% back in rotating categories after activation (up to $1,500 in spend per quarter, then 1%). The Discover cash back calendar stays rather consistent, but the issuer may change things every once in a while.
American Express® Green Card: Best for young professionals who travel for work
When you reach a good credit score, it can be a good time to consider a travel credit card.
The American Express Green Card can be a good entry-level travel card. It offers bonus points on travel, restaurant and transit spending (including ride-share services like Uber and Lyft), making it a great choice if you enjoy going out after a long day at work.
It also comes with a great welcome bonus of 30,000 points for cardholders who spend $2,000 in their first three months, worth about $300 in travel booked through the American Express travel portal. You can also transfer Amex Membership Rewards points to a number of travel loyalty programs at select airlines and hotels at a 1:1 rate.
Along with requiring good to excellent credit to qualify, though, the American Express Green Card carries a $150 annual fee. If you don’t do much traveling or eating out or if you use transit services only rarely, it will be tough to make up the cost of the annual fee.
Wells Fargo Platinum card: Best for financing a new purchase
Let me tell you something: Being in your twenties is expensive. You might need money for a new professional wardrobe, for example, or to furnish a new apartment. Maybe you need to cover the costs of a move – or a marriage. Luckily, for this kind of expense, there’s a 0% introductory APR card that gives you time to pay off your balance interest-free.
If you have the good to excellent credit needed to qualify, the Wells Fargo Platinum card is an excellent choice, thanks to its 18-month 0% intro APR on both purchases and qualifying balance transfers, with an APR of 16.49% to 24.49% variable thereafter.
If you’re looking to earn rewards on your purchases, it’s probably best to look elsewhere. But if you want to pay off your purchases without paying interest, you’ve come to the right place. Just do your best to pay off your new purchases or transferred balance in full before the end of the promotion period to minimize interest charges, and make sure you pay at least the minimum due every month to avoid damaging your credit score.
Citi® Double Cash Card: Best for young adults paying down credit card debt
One of the biggest credit card fears is that of credit card debt. It’s easier to get into credit card debt than many people realize. And given how high credit card interest rates can get, it can be very hard to get out of. That’s where the Citi Double Cash Card comes in. Transfer your existing credit card balances to this card, and you’ll get 18 months to pay them off, interest-free (variable APR of 13.99% to 23.99% thereafter).
Not only can you use this card to chip away at debt, but you can also enjoy lasting value thanks to its terrific ongoing cash back rewards program. You’ll get up to 2% cash back: 1% when you buy and 1% when you pay off those purchases, with no need to track spending or enroll in rotating bonus categories. This makes the Double Cash Card one of the best flat-rate cash back cards on the market and a smart long-term choice, even after you’ve taken advantage of its balance transfer offer.
Unfortunately, as with many balance transfer cards, the Citi Double Cash Card charges a balance transfer fee of 3% (or $5, whichever is higher). Be sure to use a balance transfer calculator and crunch the numbers to see if this makes financial sense for you.
You’ll also need excellent credit to qualify for the Citi Double Cash Card, so if your credit score has already taken a hit due to late payments or maxed-out cards, you may want to consider another option.
See related: How to consolidate credit card debt
How to choose the right credit card
When you’re trying to decide whether a credit card is right for you, ask yourself these three questions:
- What am I hoping to get out of this credit card? A better credit score? Rewards for travel spending? An opportunity to pay down debt? Knowing what you want from a credit card will help you narrow down your options.
- Is this credit card designed for people who spend like me? If a credit card offers a bonus for cardholders who spend $4,000 in three months, for example, ask yourself if that matches your current spending habits. If a card offers rewards on restaurants, ask yourself how many times you dine out every month. If a card comes with a $95 annual fee, ask yourself whether you can afford that payment.
- Can I get this card with my current credit score? If you don’t already know your credit score, you might be able to find out through your bank – but you can also use the CardMatch tool to see cards that are a good fit based on your credit profile. Additionally, you may be able to take advantage of preapproval or prequalification via an issuer’s website to see if you have a good chance of being approved for a specific credit card.
Comparing the best cards for young adults
Here’s a quick breakdown of the top picks for credit cards for young adults. Whether you’re just getting started with credit, working to rebuild your score after a few missteps or are ready to take advantage of your top-notch credit history to earn rewards and luxury perks, you should find a card that fits your needs.
|Secured Mastercard® from Capital One||None||$0|
|Discover it® Student Cash Back||$0|
|Chase Freedom Unlimited||$0|
|Discover it® Cash Back||$0|
|American Express® Green Card||$150|
|Wells Fargo Platinum card||None||$0|
|Citi® Double Cash Card||$0|
Credit cards can be intimidating, but don’t let that put you off from applying for a card that can help you earn rewards, boost your credit or help you cover a large purchase. The more you use credit cards, the more comfortable you’ll feel using them.