Stepping into financial freedom is both exciting and a big step. For many, getting their first credit card is a key moment. The best credit cards for young adults can offer a chance to build credit and earn rewards. Yet, finding the right one can seem like a tough task.
I remember feeling overwhelmed by the many credit card options. It was more than just picking a card. I needed one that matched my financial goals and lifestyle. I wanted a card to build credit, offer rewards, and have low fees.
Now, there are many credit cards designed for young adults with no credit. This guide will help you find a card that fits your financial needs. Whether you’re into cash back, like with the Discover it® Student Cash Back, or travel rewards, like with the Chase Sapphire Preferred® Card, there’s an option for you.
Finding the right credit card can change your life. It can improve your financial management, help you earn rewards, and build a strong credit history. This guide will help you explore the best options, whether you want rewards or need a card without credit history.
- Discover it® Student Cash Back offers 5% cash back on rotating categories.
- Chase Sapphire Preferred® Card provides 75,000 bonus points after you meet the spending criteria.
- Secured credit cards are great for those with no credit history.
- The Wells Fargo Active Cash Card has 0% APR for the first 15 months.
- Looking for low interest rates and no annual fees is smart when choosing a card.
Want to learn more? Head over to the best credit cards for young adults for an in-depth review of the top choices.
Why Every Young Adult Needs a Credit Card
Getting a credit card is a big step towards financial independence for young adults. It makes daily spending easier and helps in building credit history and score. This is very important for getting loans, renting places, or even for some jobs. A study showed that 44% of young adults don’t fully understand how credit scores work. This highlights the need for more knowledge about money.
Your credit card use shapes your credit score. This score affects your ability to get loans and the interest rates you’ll pay. According to Experian, 92% of people with a perfect 850 credit score are older, because they’ve had time to build their credit. Young people can aim for this too by using credit cards wisely. Keeping credit use under 30%, paying bills on time, and having different types of credit helps in building your credit history and score.
Starting early with credit cards can shape your financial future positively. Around 70% agree that college students can build a good credit score with smart credit card use. For instance, the Capital One Platinum Secured Credit Card starts with a deposit as little as $49, $99, or $200. It also increases your credit limit after six months of on-time payments.
The Discover it® Student Cash Back card allows young adults to earn 5% cash back on certain purchases. This can save money while you learn money management. The Discover card doubles the cash back in the first year, encouraging financial growth through rewards.
Having a credit card is not just for spending. It’s about creating a strong financial background for your future. It helps with getting better rates on loans or understanding your finances better. Being smart with your credit card opens up many financial chances.
| Benefits | Details |
|---|---|
| Loan Approval | Builds a credit history that influences loan approvals and interest rates |
| Financial Management | Facilitates budgeting and managing day-to-day expenses |
| Rewards | Earn cash back, rewards, and benefits such as the 5% cash back with Discover it® Student Cash Back card |
| Security Deposits | Capital One Platinum Secured Credit Card offers deposits as low as $49 |
What to Look For in a Credit Card
Understanding Fees is key when choosing your first credit card. Many young adults don’t fully grasp how to use credit cards. This can lead to financial problems. About 30% of young adults carry credit card debt each month. So, making smart financial plans is key.
The Credit CARD Act of 2009 states that if you’re under 21, you need a co-signer or enough income to cover your credit limit. Knowing about Interest Rates is also vital. The average interest rate for young adults is between 15% and 25%. Promotional rates can help but be sure you know how they change after the promotion ends.
Credit card companies tell you how long paying off debt with minimum payments takes. This can make repayment last a long time. A study shows that only making minimum payments means you could pay more than double the interest over time. This makes your debt last longer. So, it’s important to check your credit requirements and qualifications. You can get a free credit report each year from the three national credit bureaus to keep an eye on your credit.
Financial institutions have special credit offers for young people. These include lower fees and interest rates. But, only about 20% of students use these offers. Choosing low interest or student credit cards can save money and help build good credit. In time, using your card right can even earn rewards. For example, the Petal® 2 Visa® Credit Card offers up to 1.5% cash back after a year of good use.
Perks and bonuses can sway your credit card choice a lot. Many cards offer cashback, rewards for eating out and traveling, and 0% APR periods as a start. Using your credit wisely and paying on time keeps your credit score healthy and brings the most benefits.
| Card Name | Intro APR | Regular APR | Cashback | Annual Fee |
|---|---|---|---|---|
| Discover it® Secured Card | 10.99% (6 months) | 28.24% | 2% (Gas & restaurants) | None |
| Discover it® Student Cash Back | 0% (6 months) | 18.24%–27.24% | 5% (Quarterly rotating) | None |
| Citi® Diamond Preferred® Card | 0% (12 months) | 18.24%–28.99% | None | None |
| Capital One Platinum Credit Card | None | 29.99% | None | None |
Paying attention to Fees, perks, interest rates, and credit needs helps make a good choice. Checking your credit score often with available services is great for your credit health. Choose smartly and enjoy the benefits for a long time.
Best For Travel Enthusiasts: Chase Sapphire Preferred® Card
For those who love to travel, the Chase Sapphire Preferred® Card is a top choice. It offers great rewards and benefits. New users can get 60,000 Ultimate Rewards points after spending $4,000 in the first three months. These points can be used for amazing travel adventures.
Looking at the Rewards and Benefits deeper, the card shines with its earning rates. You can get 3 points per dollar on dining, including takeout and delivery. Also, you earn 2 points per dollar on travel. Plus, there are no extra fees on purchases made abroad.
The card allows you to transfer points to over a dozen airline and hotel partners. With an annual fee of just $95, the benefits like credits and insurance options add high value. Extras include trip cancellation insurance, car rental insurance, and a $50 hotel credit each year.
This card is unique when compared to others, offering travel-focused bonuses. Unlike American Express, Chase lets you earn the welcome bonus again after 48 months. The 5/24 rule applies, prioritizing exclusivity among applicants.
| Attributes | Chase Sapphire Preferred® | Capital One Venture Rewards |
|---|---|---|
| Welcome Bonus | 60,000 points | 75,000 miles |
| Points Earning Rate | 3X on dining, 2X on travel | 5X on hotels, 2X on all purchases |
| Annual Fee | $95 | $95 |
| Annual Hotel Credit | $50 | $300 |
| Foreign Transaction Fees | None | None |
| Annual Travel Credit | None | $300 |
The Chase Sapphire Preferred® Card combines excellent rewards and travel benefits with flexibility in redemption and protection. For details on securing your data and the privacy policy, click here.
Credit Cards for Those Building or Fixing Credit
Are you a young adult looking to build or fix your credit? The Capital One Platinum Secured Credit Card and the Discover it® Student Cash Back are great choices. They’re designed for people who are starting out or who have made mistakes in the past. With these cards, you can start to build a responsible credit history.
The best credit cards for building credit come with features that help you reach your financial goals. For instance, the Capital One Platinum Secured Credit Card starts with a refundable security deposit of as low as $49. You also get an initial credit limit of at least $200. With consistent payments, your credit limit can increase over time.
In comparison, the Discover it® Student Cash Back card rewards you more for specific types of spending. You get 2% cash back at gas stations and restaurants on up to $1,000 in purchases each quarter. Plus, you earn 1% cash back on all other purchases. Discover will even match all the cash back you’ve earned at the end of your first year.
| Card | APR | Annual Fee | Cash Back | Initial Credit Limit |
|---|---|---|---|---|
| Capital One Platinum Secured Credit Card | 29.74% | $0 | N/A | $200 |
| Discover it® Student Cash Back | 14.24% – 35.99% | $0 | 1% – 2% | $500+ |
Both cards are good for building or fixing your credit. They report to all three major credit bureaus. This shows you’re using credit wisely. With pre-qualified offers for the Capital One card, you can check if you’re eligible without hurting your credit score.
Looking for more options? There are 16 other credit-building card offers out there. Whether you’re interested in secured or student cards, there’s something for everyone. The Capital One Platinum Secured and Discover it® Student Cash Back cards are especially popular among young people working on their credit scores.
Low Interest and Easy to Manage: Wells Fargo Active Cash Card
For young adults, a credit card with a simple rewards structure and easy management is key. The Wells Fargo Active Cash Card is an excellent option. It has a $0 annual fee and was named the Best Credit Card for Simple Cash Back from 2022 to 2024 by NerdWallet. This card makes managing finances easier while offering great benefits.
The Wells Fargo Active Cash Card lets you earn unlimited 2% cash rewards on purchases. You won’t have to keep track of categories. New cardholders get a 0% introductory APR for 12 months on purchases and qualifying balance transfers. This makes it one of the best low interest credit cards for newcomers. After that, the APR is between 19.24% to 29.24%, based on your credit.
Managing this card is easy with Wells Fargo’s tools and services. It also offers up to $600 in cellular phone protection against damage or theft, with a $25 deductible. You’re allowed two claims every 12 months. This ensures your phone is protected while you focus on your financial goals.
If you need emergency cash or card replacement, it’s available in 1 to 3 days after approval. This feature makes it a very accommodating option. Wells Fargo Online® customers also get monthly FICO® Score updates for free. This helps you keep track of your credit score.
The redemption options are flexible and straightforward. You can use rewards for purchases from as low as $1.11. Cash redemption is offered in $20 increments at Wells Fargo ATMs. For gift card fans, you have popular $25 options. Plus, there is a $200 cash rewards bonus for spending $500 in the first three months.
| Feature | Details |
|---|---|
| Annual Fee | $0 |
| Rewards Rate | Unlimited 2% cash rewards on all purchases |
| Introductory APR | 0% for 12 months on purchases and balance transfers |
| Post-Intro APR | 19.24% – 29.24% Variable APR |
| Balance Transfers | Must be made within 120 days to qualify for the intro rate |
| Cell Phone Protection | Up to $600 against damage/theft, $25 deductible |
| Emergency Cash Disbursement | 1-3 business days post-approval |
The Wells Fargo Active Cash Card was named the Best No Annual Fee Credit Card by The Ascent in 2023. It was also the Best Overall Cash Back Card by WSJ Buy Side in 2024. It offers an easy and effective way to manage finances. With its low interest rates and simple rewards, it’s perfect for young adults wanting to build good financial habits.
Conclusion
Choosing the right credit card is very important for a young adult’s financial future. This best credit cards guide discussed various options. These options suit different needs, such as travel or improving credit scores.
Key factors like starting offers, APR rates, and cash back rewards are crucial in making a wise decision. For instance, Chase Freedom Unlimited® offers a $200 bonus for spending $500 in the first three months. It also gives up to 5% cash back at gas stations. Meanwhile, Discover it® Secured Card is great for earning 2% cash back at grocery stores and restaurants. This helps young adults build a strong credit history.
It’s important to match your credit card with your financial goals. Knowing the regular APR rates helps manage your credit and payments. For example, Chase Freedom Unlimited has a rate of 15.74% – 24.49%. Ink Business Cash has a rate of 13.99% – 19.99%. Also, try to avoid cards with high fees unless they offer significant benefits.
FAQ
Why is it important for young adults to have a credit card?
Having a credit card is crucial for young adults. It helps build a credit history, important for your financial future. Good credit can get you loans, better rates, and job opportunities. It encourages managing money wisely.
What are the best credit cards for young adults with no credit?
For those starting, the Capital One Platinum Secured Credit Card and Discover it® Student Cash Back are great. They help build credit with spending limits and rewards for paying on time.
How do I choose the best credit card as a young adult?
Choosing a card involves looking at fees, interest, and requirements. Seek cards with cashback, dining and travel rewards, and 0% APR offers. This can cut costs and fit your spending.
What makes the Chase Sapphire Preferred® Card ideal for young professionals?
The Chase Sapphire Preferred® Card is top for those loving travel and dining. It has great travel rewards and points for various partners. With travel credits and no foreign fees, it’s valuable despite the fee.
Are there low interest credit cards suitable for young adults?
Yes, the Wells Fargo Active Cash Card is great for its low interest. It gives rewards on purchases and an introductory APR. This makes it appealing for new cardholders.
Can student credit cards help in building a credit history?
Yes. Cards like Discover it® Student Cash Back are for building credit. They offer educational resources and rewards for good habits, key for a strong credit history.
What are prepaid credit cards for young adults?
Prepaid cards are for those who may not get traditional cards. You can load money and control spending without debt risk. They’re a step towards regular credit cards later.
Source Links
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- Credit Card Tips for Teens and Young Adults | Chase – https://www.chase.com/personal/credit-cards/education/basics/first-credit-card-tips-for-young-adults
- Why it’s important to open a credit card at age 18 – https://www.cnbc.com/select/whats-the-best-age-for-first-credit-card/
- Understanding Credit Cards: A Comprehensive Guide for Young Adult – Park View Federal Credit Union – https://www.pvfcu.org/guide-to-credit-cards-for-young-adults/
- Getting a Credit Card: 4 Things for Young Adults to Know | Equifax – https://www.equifax.com/personal/education/credit-cards/articles/-/learn/getting-a-credit-card-4-things-for-young-adults-to-know/
- Best first credit cards for young adults – https://www.creditkarma.com/credit-cards/i/best-first-credit-card-for-young-adults
- 9 Best Credit Cards For Young Adults | MoneyLion – https://www.moneylion.com/learn/best-credit-cards-for-young-adults/
- Why the Chase Sapphire Preferred is more than just a starter card – The Points Guy – https://thepointsguy.com/credit-cards/sapphire-preferred-more-than-starter-card/
- ChooseFI’s Top 10 Recommended Travel Rewards Cards – January 2025 – https://choosefi.com/top-recommended-travel-cards
- Chase Sapphire Review 2025: A card for travelers – Lonely Planet – https://www.lonelyplanet.com/articles/chase-sapphire-review
- Best Credit Cards for Building Credit of 2025 – Experian – https://www.experian.com/credit-cards/best-building-credit/
- Best credit cards for teens: What you need to know – https://www.creditkarma.com/credit-cards/i/credit-cards-for-teens
- Earn Unlimited 2% Cash Rewards – https://creditcards.wellsfargo.com/active-cash-credit-card/
- Wells Fargo Visa® Credit Cards and Mastercard® – https://creditcards.wellsfargo.com/
- 7 Best Credit Cards for Young Adults in 2024 – https://management.org/best-credit-cards-for-young-adults
- 7 best credit cards for young adults – https://www.finder.com/credit-cards/best-credit-cards-for-young-adults
- What is the best Credit Card in your 20s? || Bright App to get out of Debt – https://www.brightmoney.co/learn/what-is-the-best-credit-card-in-your-20s
