Getting your first credit card can feel intimidating, but it’s an important step in building the credit you need later in life. After all, credit card issuance allows you to report your on-time payments to three credit bureaus – Experian, Equifax and TransUnion. This report combined with responsible credit card usage can increase your credit score and add depth to your credit reports over time.
Read on to find out how to qualify and apply for your first credit card and what steps to take first.
Check your credit score
The best credit cards on the market today are usually only available to those with good and excellent credit or FICO scores of 670 or higher. Still, starter credit cards usually come with decent perks. Some good options to consider are store credit cards, student credit cards and secured credit cards.
Either way, checking your credit score is a good first step. And contrary to popular belief, you don’t have to pay for it. There are several reputable services that allow you to check your credit score for free. Programs such as Capital One’s CreditWise and Chase’s Credit Journey, for example, do not require you to pay or become an account holder.
See if you are pre-qualified
Typically, being prequalified means that the distributor has conducted a soft credit check, which means that you are likely to get approved for a particular credit card. Credit card offers that you receive in the mail are usually pre-qualified.
You can call any credit card issuer and ask for your pre-qualified offers, but it can be tedious. Bankrate’s CardMatch tool displays your legacy offers from various credit card issuers, allowing you to focus on choosing the best card for you.
With basic information such as your name, your address and the last four digits of your Social Security number, you can find out if you are targeting any specific credit card offers.
The best part? Using a cardmatch tool will not cause a harsh inquiry into your credit report. You use the tool to find out if you meet the basic requirements of the approval set by the credit card issuer and after that you can decide if you want to apply.
Check with your bank
If you have a long history with a bank or credit union, consider exploring its credit card options. Your bank has a record of your financial transactions and a history of working with you already, so they are more likely to approve you for credit than other financial institutions.
Call your bank or talk to your banker to find out if you are pre-qualified for any particular credit products. And remember, the worst they can say is “no”.
Make sure to list all your income in your app
Once you take steps to apply for the first credit card, you will need to do everything to increase your approval odds. This means filling out your credit card application with all the information the company requests, but also knowing the laws about the types of income you can add.
According to the Consumer Financial Protection Bureau (CFPB), people under the age of 21 have different rules. In particular, card dealers only need to look at your personal income if you are under 21 years of age. Spouse or spouse is 21 or older. However, this money may include:
- You earn income through work or other means
- The income or assets you earn from a company that you own alone or jointly with someone else
- The income or property is regularly credited to someone else’s account
If you are at least 21 years old, card dealers, on the other hand, may consider the money you earn or the income from a spouse or partner. In other words, if you are 21 or older – even if you are a stay-at-home spouse, your total household income can be listed on your credit app as yours.
Consider the best starter credit cards
Once you’re ready to get your first credit card and start building credit, there are plenty of excellent starter cards to consider. Here are some of our favorites.
Bank of America Unlimited Cash Rewards Secure Credit Card
Bank of America® Unlimited Cash Rewards A minimum $ 200 security deposit is required to get started with a secure credit card. However, there is no annual fee, and cardholders can earn up to 1.5 percent cash back on every purchase they make. The security deposit is fully refundable when the account is closed or upgraded in good standing.
This card reports to three credit bureaus and cardholders receive a free FICO credit score in their monthly statement.
Journey Student Rewards from Capital One
College students can also check out Journey Student Rewards from Capital One. This card comes with no annual fee and the applicant can measure their approval odds on their credit reports without a rigorous inquiry.
Perks include earning at least 1 percent cash back on all purchases, or 1.25 percent cash back when paying monthly bills. Cardholders receive $ 5 per month ($ 60 per year) on credit for streaming subscriptions when they pay for eligible streaming services with their credit card.
Capital One QuickSilverOne Cash Rewards Credit Card
Finally, holders of “fair” credit, or those with a FICO score of at least 580 and 669, may consider the Capital One QuicksilverOne Cash Rewards credit card. The card charges an annual fee of $ 39, but those who choose it receive a flat 1.5 percent cash back for every dollar they spend.
Rewards can be redeemed for cash back, statement credits, gift cards and more. Cardholders can qualify for automated credit line reviews and have the potential for a higher limit within six months.