Comparing the Best Starter Credit Cards
Credit cards can be a great way to build a credit history, earn rewards and learn financial independence. Even if you’re just getting started, you should be able to find a card that fits your needs. The key is to know what to look for in a starter credit card and how to use your first card responsibly. Here we cover:
Best Starter Credit Cards of 2021
Starter rewards cards
Discover it® Student Cash Back: Our pick for new users
This card has a few features that make it friendly for first-timers: You won’t be charged a late fee the first time you miss a payment due date (after that it’s up to $40), and Discover will never increase your APR if you struggle to pay on time. You’ll earn 5% cash back in an array of rotating cash back categories each quarter (upon enrollment, on up to $1,500 in combined spending per quarter, then 1%). This includes spending at places like gas stations, restaurants, grocery stores and on online shopping. There is a 0% introductory APR on new purchases for the first 6 months, but watch out for the regular APR of 12.99%- 21.99% variable after that.
Capital One VentureOne Rewards Credit Card: Our pick for travel
The VentureOne is a great place to start your travel rewards journey, offering unlimited 1.25X miles on all purchases without charging an annual fee. You can also score a sign-up bonus of 20,000 miles if you spend $500 in the first 3 months. Even better, your miles never expire and you have a ton of flexibility in how you redeem them: You can book travel through the Capital One Travel Center, cover travel booked via an outside site or redeem miles for gift cards or cash back. One thing to keep in mind is that your miles are worth much less if you opt for a gift card, statement credit or check instead of redeeming for travel. If you aren’t sure whether you want to use your credit card rewards for travel or cash back, you may be better off sticking with a more general rewards card.
Discover it® Cash Back: Our pick for cash back
Few cards let you earn cash back at such a high rate on such a wide variety of purchases. You’ll earn 5% back in rotating categories each quarter upon enrollment (on your first $1,500 in combined quarterly purchases, then 1%). Bonus categories for the first quarter of 2021 include grocery stores, Walgreens and CVS. Those rewards alone are valuable, but what makes this card a star is Discover’s Cashback Match, which automatically matches all the cash back you’ve earned at the end of your first year. One potential drawback: You’ll only earn 5% cash back on the first $1,500 you spend in combined bonus categories each quarter, then 1%, following activation. If you spend heavily in a particular category, like dining or travel, you might earn more in the long run with another card that offers uncapped bonuses in those categories, even if its rewards rate is lower.
Capital One SavorOne Cash Rewards Credit Card: Our pick for dining
Offering 3% cash back on dining and entertainment and 2% back at grocery stores, this is a great starter card for foodies. You can set up automatic cash back redemptions or redeem manually as a statement credit, check or gift card in any amount, at any time. You’ll also get a $200 bonus if you spend just $500 in the first 3 months. One critique is that it isn’t the most versatile cash back card. Unless you spend heavily in the SavorOne’s bonus categories, you’ll likely earn more with a card that offers cash back at a flat rate on all purchases.
Capital One QuicksilverOne Cash Rewards Credit Card: Our pick for everyday spending
You’ll earn consistent and unlimited 1.5% cash back on every purchase, and your cash back never expires. Plus, you can qualify even if your credit is just average. You’ll enjoy a number of great perks like fraud coverage, emergency card services if your card is lost or stolen, and identity theft protection. On the other hand, it charges an annual fee of $39, and unlike many rewards cards, it offers no sign-up bonus and charges all cardholders the same very high variable APR of 26.99%, regardless of credit history.
Discover it® chrome: Our pick for gas
You’ll earn 2% cash back on gas station purchases and 2% back at restaurants on up to $1,000 in combined spending per quarter, plus unlimited 1% back on all other purchases. This card offers consumer-friendly terms, charging no foreign transaction fee, no penalty APR and no late fee for the first late payment (after that it’s up to $40). It also comes with a free FICO credit score on every statement. When you factor in Discover’s first-year Cashback Match, it offers one of the top cash back rates on gas station purchases available at no annual fee.
Secured Mastercard® from Capital One: Our pick for no annual fee
In addition to charging no annual fee, the Secured Mastercard® from Capital One has low fees for beginner mistakes like late payments. If you’re late to make a payment, the fee will only be up to $40, and your APR won’t increase as a result. Depending on your credit, the required security deposit could be as low as $49 (or as high as $200, which is still reasonable). After 6 on-time monthly payments, you’ll be considered for a higher credit line, which could boost your credit score and put you on an expedited path to the credit of your dreams. Plus, there’s no annual fee, so you don’t have to worry about a bill derailing your plan for on-time payments. You won’t earn rewards with this card, which is fairly common with secured cards. However, some secured cards do offer cash back and other forms of rewards. Also common for secured cards, the ongoing APR is high: 26.99% variable.
Starter cards for no credit
Capital One Platinum Credit Card: Our pick for no credit history
The Capital One Platinum has several features that allow you to beef up your credit history without drowning in fees: It charges no annual fee, foreign transaction fee or penalty APR and includes free credit monitoring. Plus, you won’t have to tie up any money in a security deposit, and your account will be reviewed for a credit limit increase if you make your first 6 monthly payments on time. One thing to keep in mind if you have low or no credit is that your credit limit may start out fairly low. Also, the card carries a very high variable APR of 26.99%.
Deserve® EDU Mastercard for Students: Our pick for students
You don’t need a traditional credit history to be approved for this card; even international students are able to apply without a Social Security number. The card also charges a lower late fee than most and no penalty APR, making it a safe starter option. One extra perk that students may find useful is one year of Amazon Prime Student (after spending $500 within the first 3 billing cycles), with perks like free shipping and Prime Video streaming. It also charges no foreign transaction fee – perfect if you plan to travel or study abroad. On the flipside, 1% cash back isn’t a competitive rate. There are starter cards with better cash back rates, which will be valuable for years after graduation.
Credit One Bank® Visa® for Rebuilding Credit: Our pick for bad credit
One of the few cards for bad credit with a cash back rewards program, it offers 1% cash back rewards on eligible purchases, including gas, groceries and services such as mobile phone, internet, cable and satellite TV. Terms apply. It also comes with free access to your Experian credit score, and you can check if you prequalify online. Note that you may have to pay an annual fee of $0-$99, which will immediately reduce your credit limit and will be difficult to offset with cash back rewards. The card also carries a standard 3% foreign transaction fee ($1 minimum).
Discover it® Secured: Our pick for secured card with rewards
With this card, there’s no need to choose between credit-building features and the ability to earn rewards. You’ll earn 2% cash back at gas stations and restaurants (up to $1,000 in combined purchases each quarter), and all of your cash back will be matched at the end of your first year. After 8 months of having your card, you’ll be automatically considered for a higher credit line, which can boost your credit score. With several valuable perks and no annual fee, this is an excellent starter card. One of the only potential drawbacks is the required security deposit of at least $200, though it is refundable.
Comparing the best starter credit cards
|Credit Card||Best for||Annual Fee||Review score|
|Discover it® Student Cash Back||New users||$0||4.2 / 5|
|Capital One Platinum Credit Card||No credit history||$0||3.7 / 5|
|Capital One VentureOne Rewards Credit Card||Travel||$0||3.0 / 5|
|Deserve® EDU Mastercard for Students||Students||$0||2.6 / 5|
|Discover it® Cash Back||Cash back||$0||4.3 / 5|
|Capital One SavorOne Cash Rewards Credit Card||Dining||$0||3.7 / 5|
|Credit One Bank® Visa® for Rebuilding Credit||Bad credit||$0-$99||2.2 / 5|
|Capital One QuicksilverOne Cash Rewards Credit Card||Everyday spending||$39||4.1 / 5|
|Discover it® chrome||Gas||$0||4.1 / 5|
|Secured Mastercard® from Capital One||No Annual Fee||$0||3.4 / 5|
Who should get a starter credit card?
Technically, “starter credit card” just refers to a credit card with low credit requirements and perhaps other built-in features to cater to first-time cardholders. Because of this, they’re good for people with bad or no credit, students and people who haven’t built solid credit habits yet.
You should think of a credit card as a tool that can help you accomplish your financial goals. If you’re applying for a credit card, whether it’s your first or fifth, you should always have a goal in mind. So whether you want to build credit or start earning rewards, just know what you’re looking for before you apply.
How to get started with your first credit card
If you’re interested in getting your first credit card, you probably have a few questions about how to use them responsibly and the types of credit cards available to beginners. Here, we’ll lay out some tips for choosing, applying for and using your new credit card.
Check your credit
When researching credit cards, you’ll sometimes find cards that require applicants to have a certain credit quality in order to be approved. The credit ranges are sorted into 5 categories and give a good idea of the cards available to you:
Starter credit cards will typically not require any score higher than fair credit, and you can even qualify for some cards with bad credit. You should check your credit score before applying, even if you think you have no credit history. A few points can make a big difference in the quality of credit cards you qualify for. Plus, you can check your credit score for free.
Apply for a credit card
You can apply online, in person, or via mail with a bank, credit union or store that offers its own credit card. You’ll need information like your legal name, birth date, address, Social Security number, annual income, how long you’ve lived at your current address, whether you own or rent, your monthly housing payment and what type of bank account you have.
Your credit score may decrease a few points after you apply, which is why it’s good to only apply for cards that you’re likely to be approved for. You can use our CardMatch tool to find out which cards you prequalify for without affecting your credit score.
Spend responsibly and pay on time
After getting approved and receiving a credit card, it’s as simple as swiping the card. Don’t overspend beyond your means, but making a few purchases that you can comfortably pay off is a great way to get started.
Every 30 days or so, you’ll get a bill detailing what you’ve purchased. Your card will come with a minimum payment amount you must meet for each of these billing cycles. It’s best to pay each statement in full, however, if you want to avoid interest charges. Making timely, sufficient payments is a surefire way to quickly grow your credit score.
What to look for in a starter credit card
If you’re getting your first credit card, it’s important to know what kinds of benefits you want. Do you want to start earning rewards, or is it more important that you get a high credit limit? Here are a few card features that may be particularly helpful for first-timers.
- Waived late-payment fees
- No penalty APR for late payments
- A simple cash back or travel rewards structure
- Access to credit monitoring
- Automatic consideration for a credit limit increase
- Ability to enroll in auto-pay for monthly payments
- No annual fee
- No foreign transaction fees
What kind of credit card should I start with?
Depending on your credit history (and whether you even have one), your spending habits, and your personal life and financial goals, you may consider yourself a certain type of consumer:
Consumers looking for no annual fees and potentially more forgiving terms on common penalties may want to look to a student card. With benefits tailored to college and graduate students, such as dining rewards and rewards for keeping a certain GPA of 3.0, these cards can carry “A+” value.
An option like the Discover it® Student chrome, for example, allows you to earn 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter, plus unlimited 1% cash back across your other purchases. On top of that, Discover will match the amount of cash back you earn in your first year. Additionally, this card features no annual fee and no APR change for paying late – a couple of common features of student cards.
Travel cards typically require you to have good to excellent credit to qualify, so if you’re totally new to credit, you should probably avoid applying. If you do try for a travel card, it’s best to stick to one that charges no annual fee and offers a straightforward rewards program.
Those with established credit have plenty to choose from when sifting through travel cards, but it’s difficult to get rewarded for your travel purchases right out of the gate. The Deserve® EDU Mastercard for Students, however, offers some benefits for wanderlusting new cardholders: no foreign transaction fees, unlimited 1% cash back on all purchases and nearly worldwide acceptance, thanks to Mastercard.
The cash back chaser
Cash back cards give you back a percentage of what you spend each time you make a purchase, allowing for consistent and immediate earning. When you don’t have to change the way you naturally spend, earning comes easy with a cash back card. Look for an option offering bonuses that match your spending habits or stick with one that gives cash back at a flat rate on all purchases.
In addition to the options above, the Credit One Bank® Visa® for Rebuilding Credit features widespread cash back earning. Those with no credit history can earn 1% cash back on eligible purchases such as gas, groceries, cell service, internet and cable.
The credit builder
Secured cards require you to put down a deposit to become a cardholder, making them much easier to qualify for than traditional, unsecured cards. For this reason, secured cards are great for consumers who are just beginning their credit journey as well as those who are determined to improve bad credit. The security deposit is refundable and usually equal to your credit limit, so getting into a proper payment routine will make the upfront cost negligible. Many secured cards offer a chance to upgrade to an unsecured version once you’ve shown responsible use.
Secured cards can set you up for success with credit-building benefits. With the Self – Credit Builder Account + Secured Visa® Credit Card, hopeful cardholders with no credit history can combine a credit building account with a secured card. This specialized account will report to all 3 credit bureaus, flexing your on-time payments for you and building your credit score. Plus, they reward good habits: After 3 months of on-time payments and savings over $100 in the account, cardholders in good standing are eligible to upgrade to the Self Visa Credit Card.
Many stores offer their own rewards cards to encourage shopper loyalty. These cards generally carry no annual fee and can offer good approval odds, but often come with gigantic APRs, making them risky for credit card beginners. Even so, these cards give consistent customers a great opportunity for heightened earnings at their favorite stores.
For those keen on online shopping, the Amazon Prime Rewards Visa Signature Card allows for fair credit and gives new cardholders a $70 Amazon.com gift card as a sign-up bonus. It comes with no annual fee, but you do need an eligible Amazon Prime membership ($119 annually for most consumers) to qualify. That can be worth it when you earn 5% back on Amazon.com and Whole Foods purchases, 2% back on dining, drug store and gas purchases, and 1% back on all others.
Credit card tips for your first credit card
If you don’t use your card responsibly, you could end up buried in debt or do long-term damage to your credit score. Here are our top tips to help credit card beginners create healthy habits:
- Don’t charge what you can’t pay back. Avoid a “buy now, pay when I have the money” approach. Stick to small, manageable expenses while you get used to using your card and only charge what you’re positive you can pay off.
- Pay more than the minimum. If you carry a balance and only make the minimum payment due on your credit card, interest charges will quickly start to pile up, growing your balance each month until you end up buried in debt.
- Pay on time. Payment history is the biggest factor in credit scoring, and even one late payment can do major damage. To avoid this (and the fees that come with paying late), set up text or email alerts to remind you when your bill is due or set up an automatic credit card payment with your bank.
- Don’t max out your card. Credit utilization – the amount you owe compared to your available credit – is one of the biggest factors in credit scoring. If you consistently “max out” your card, you seem like more of a risk to lenders.