Categories

Reviews

The Best Credit Cards for Young Adults in 2020

Young people love shopping online, traveling, and staying in hotels. However, in order to manage all that, you often need a credit card. The hunt for the right card isn’t always easy, and there are no guarantees you’ll be approved.

That’s why we’ve compiled a list of the best credit cards for young adults. These options are easy to qualify for and help you with building good credit. You can also take advantage of cashback rewards and free travel miles while learning how to manage your finances.

SHOW MORE

The Best Credit Card for Young Adults - Our Picks

Top 3 picks

Discover it® Secured

No annual fee

Unlimited cashback during the first year

Can be upgraded to unsecured

Apply Now READ REVIEW

Petal 2 Visa® Credit Card

High credit limit

No maintenance fees

Good for car owners

Apply Now READ REVIEW

Capital One® Venture® Rewards

Bonus miles on every purchase

Good choice for young entrepreneurs

No foreign transaction fees

Apply Now READ REVIEW

1. Discover it® Secured

The Discover it Secured credit card is often the first choice for many young Americans. It doesn’t require a high credit score, comes with no membership fees, and provides cashback on every purchase with some bonuses after the first year. It’s the best credit card for a college student on a budget.READ REVIEW

No annual fee

Unlimited cashback during the first year

Can be upgraded to unsecured

Apply Now

show more


Sign-up process:

Welcome offer:

Rewards:

Pricing:

2. Petal 2 Visa® Credit Card

Petal’s card comes with some requirements, but it has the highest credit limit of all the starter cards. The cashback program rewards customers that don’t have late payments, and the fact that there is no membership fee is a nice bonus.READ REVIEW

High credit limit

No maintenance fees

Good for car owners

Apply Now

show more


Sign-up process:

Welcome offer:

Rewards:

Pricing:

3. Capital One® Venture® Rewards

The Capital One Venture Rewards card is one of the best credit cards for graduates and startup owners who travel a lot. While it’s not the easiest card to get, it can earn you up to $1,500 annually in bonus points, which can be converted to cheaper flights, free hotel rooms, or gift cards.READ REVIEW

Bonus miles on every purchase

Good choice for young entrepreneurs

No foreign transaction fees

Apply Now

show more


Sign-up process:

Welcome offer:

Rewards:

Pricing:

4. Chase Freedom Unlimited®

Chase Freedom Unlimited is ideal for prudent shoppers. Stacked with cashback bonuses and annual rewards, this is the card you’ll want for each shopping season.READ REVIEW

High cashback on grocery shopping and travel

No annual fee

Cashback rewards don’t expire

Apply Now

show more


Sign-up process:

Welcome offer:

Rewards:

Pricing:

How We Evaluate The Best Credit Cards for Young Adults - Our Methodology

There are many different types of credit cards, which is why it’s important to know what you’re looking for. Our methodology helps you comb through the different offers and find the most suitable card for your unique needs.

If you follow our guidelines, you’ll end up with a great cashback credit card that doesn’t come with high APR or annual fees.

Requirements

Getting a credit card for no credit history might sound difficult, but it is possible. Credit card requirements vary, and we look for cards with low or no credit score requirements while also examining the deposit requirements.

Ideally, the card should have a low minimum security deposit and a high credit limit. Another important factor is whether a bank account is needed to apply for the credit card. It’s better if the card can be used without a bank account, as that can lead to additional fees.

Rewards and Welcome Offer

One of the main reasons people get starter credit cards is the rewards program. This usually comes in two phases. The first is the welcome offer. It can either act as an incentive for signing up with the credit card company or remain active throughout your first year.

Depending on the credit card company, this bonus can come in the form of cashback at the end of the year, points for spending on rewards, or bonus miles.

Ongoing rewards are equally important and are one of the main reasons why young adults insist on these cards. Again, your first-time credit card may either reward you with cashback after every qualifying purchase or provide you with bonus miles that you can use when traveling.

The exact rewards depend on individual credit card companies and the sort of deals they have with other businesses. It’s not very common to find a card that offers both cashback and airline rewards programs.

Fees and APR

Fees are unavoidable when it comes to credit cards. That’s no real surprise; this is how credit card companies earn their money. Luckily, the best credit cards for young adults usually come with significantly lower fees than the cards their parents use.

The fees include a pre-set APR, either fixed or variable. Most credit card companies try to attract new customers by offering a lower APR during the first year – some even go as low as 0% APR during that time period.

Of course, there’s also the annual credit card membership cost. We look for cards that either have sub-$100 annual fees or don’t have any membership fees at all.

Best Credit Cards for First-Timers in 2020:

What is the best credit card for young adults? Detailed Reviews

As the name implies, Discover it Secured is a secured type of credit card. This means that the company requires you to make a deposit when signing up. This deposit is used to cover any late payments and is returned to you once you upgrade to an unsecured card. But we’re getting ahead of ourselves. Let’s see why this is one of the best first credit cards for young adults.

Getting the Credit Card

Before you can start paying with Discover it Secured and collecting those rewards, there’s a number of steps you’ll need to complete. When it comes to Discover, applying for a credit card also means opening a bank account.

This is the only option for financing the credit card, which could be problematic for some people. Although it’s not ideal in the short term, you’ll probably need that bank account for work-related transactions down the road.

One of the main reasons why Discover is among the top 10 credit cards for young adults is the low security deposit requirement. You’ll need to deposit a minimum of $200, while the maximum credit limit is set at $2,500. With this card, the credit limit is equal to the deposit.

s for credit score requirements, the minimum is 300. This is a relatively poor credit score, and it means that almost anyone is eligible for this card.

The card can also be upgraded. Eight months after signing up, you’ll be given the option of switching over to the unsecured card. This means you’ll get your deposit back while keeping the same account and your credit score unaffected.

Rewards Program

Discover is also considered the best credit card for young adults thanks to its rewards. The introductory offer is especially generous. Discover’s Cashback Match program enables you to earn cashback and then reclaim it in a number of ways.

The company will automatically match all the cashback you’ve earned during the first year, and the best part is that there’s no limit on the amount you can earn this way.

Speaking of cashback, this card is the perfect companion for every young person who drives a lot. It’s one of the best credit cards for rewards, as it earns you 2% cashback at gas stations and restaurants for up to $1,000 each quarter.

All other purchases are eligible for 1% cashback. Combined with the introductory offer, you can expect quite a bonus by the end of the year.

Pricing

The Discover it Secured card comes with no annual membership fees. On the other hand, the APR is unavoidable. During the first six months, your APR will be 10.99% on every balance transfer. After that, the APR goes up to 22.99% and becomes variable.

This is a bit higher when compared to other top credit cards for young adults, but there’s a silver lining: Discover won’t charge you any fees on your first late payment. It’s not much, but it helps.

Reasons to Apply

No annual fees

2% cashback at gas stations

1% cashback on all other purchases

Matched cashback after the first year

No late fees on first payments

Can be upgraded to unsecured after just eight months

Petal focuses on rewards rather than fees and provides credit cards that are ideal for first-timers. In fact, the Petal 2 Visa credit card is one of the best credit cards for young people, especially those who drive a lot.

There are some interesting perks that come with this membership, including 24/7 roadside assistance and a damage collision waiver for auto rentals. And that’s not all.

Getting the Credit Card

It’s worth mentioning that this is an unsecured card, meaning that it doesn’t require a deposit. However, getting approved for a card takes a bit of time and involves screening each candidate.

Petal uses algorithms when deciding who to approve for this card. The company takes into account any outstanding debt, late payments, and bankruptcies. If you don’t have any of those on your credit history, you’ll likely get approved.

Unlike most secure credit cards, this one has a very high credit limit of up to $10,000. The exact amount depends on the aforementioned screening process and the credit score.

As such, young people who have never had a credit card before will most likely get a significantly lower limit. At least you won’t have to put some money on the card right away, so it’s still a better option than what some of the competition is offering.

Rewards Program

Petal keeps things simple when it comes to credit card rewards and cashback. Although there’s no welcome bonus, there is an ongoing cashback deal that improves over time, which makes this the best first credit card when you’re learning about rewards.

You’ll start with a 1% cashback on your spending. If you make your credit card payments on time for six months in a row, your card gets upgraded and you’ll earn 1.25% cashback. After a full year of regular payments, you’ll reach the final rewards category of 1.5% cashback on each purchase.

Although that’s the highest rate you can get, there’s no maximum amount for the cashback, and as long as your payments are on time, the percentage won’t be reduced.

Many consider this the best cashback credit card because of its Petal Offers. Every merchant has the option to partner with Petal and enter this program, which offers some additional discounts or better cashback deals. These are usually time-limited deals and can net you up to 10% cashback.

Pricing

The Petal 2 Visa credit card has no membership fees. Even though there is no annual fee, you’ll still pay APR on each transaction. APR is variable and ranges between 12.99% and 26.99%. There are also no extra fees on foreign transactions.

Reasons to Apply

Up to $10,000 credit limit

Low credit score requirements

Petal Offers

Up to 1.5% cashback

No membership fees

The best starter credit card isn’t always about cashback and discounts. Maybe you’re traveling a lot. Maybe you’re running a startup company and have a lot of meetings out of town.

In these instances, a travel rewards card like the Capital One Venture Rewards credit card is an ideal option. This card dishes out rewards in the form of bonus miles.

Getting the Credit Card

The Capital One credit card application process is a little more rigorous compared to other names on our list. Many other companies tend to overlook very low credit scores, but Capital One requires a credit score of at least 600.

The company doesn’t offer credit cards for no credit history. Instead, there is a rewards scheme for young people who already have some experience running a business but have never had a credit card of their own.

In addition to the high credit score, candidates can’t have any bankruptcies or loan defaults on their records. Preferred candidates are those who have had no loans or a credit card for at least three years.

Rewards Program

When you compare the perks and the requirements, this card is definitely worth it. Venture is all about those free travel miles, granting you free flights across the country and upgrades to business class.

It’s not the best rewards credit card just because you get two miles for each dollar spent, but also because of the bonuses you can score along the way.

For example, if you spend at least $3,000 on various purchases during the first three months after getting this card, Capital One will reward you with 50,000 bonus miles. If you manage to spend $20,000 or more during your first year, you’ll get 100,000 miles. These points can be converted into either free miles or gift cards.

The Capital One Venture Rewards credit card also comes with free travel insurance and $100 in credit for Global Entry or TSA application fees. In short, this is not just the best credit card for first-timers. It’s also worth noting that you can use these points for accommodation and with at least 10 airline companies that are partnered with Capital One.

Pricing

As expected, such a great rewards program comes at a price. There is an annual fee of $95, which is somewhat steep considering that many other cards tailored to young adults waive these fees in favor of a higher APR. Speaking of APR, it’s variable and ranges from 17.24% to 24.49%

If you’re looking for an affordable credit card for young adults, this might not be the ideal option. But if you’re a frequent traveler who wants to take advantage of the rewards program, we highly recommend it.

Reasons to Apply

Bonus miles on each purchase

Quarterly and annual bonuses

Easy reward redemption

Valid for both travel and accommodation

$100 TSA credit

Free travel insurance

Chase Freedom Unlimited is one of the best credit cards for students and other young adults. With lots of rewards and no membership fees, it serves a broad spectrum of customers.

Getting the Credit Card

Before we look at the rewards, let’s examine the requirements. Chase isn’t the kind of company where just anyone can get a credit card, which is why it has a minimum credit score requirement of 600. Luckily, you won’t be required to place a deposit, but the exact limit depends on your credit history.

Rewards Program

In the rewards department, this is one of the best cashback credit cards. You can earn bonuses on just about anything. Initially, you can score a $200 bonus if you manage to spend $500 during the first three months after opening an account with Chase.

In addition, every purchase made in grocery stores during your first year is eligible for a 5% cashback up to $12,000 in total annual spending.

You can also net 3% of your money back in restaurants, 3% on drug store purchases, and 1.5% cashback on every other purchase. Chase often has time-limited deals with its partners for even greater rewards.

Many consider this the best credit card for students because of how flexible the point conversion is. Once you’ve accrued some credit card points, you can convert them into cash, gift cards, travel bookings, and even Amazon purchases.

Pricing

The best things in life are free and so is the membership at Chase Freedom Unlimited. In fact, during your first 15 months, you won’t need to pay a dime. The APR is 0% during this period, then it ranges between 14.99% and 23.74%.

Reasons to Apply

Cash bonus in the first three months

Up to 5% cashback

Cashback convertible to gift cards and accommodation

0% APR for the first 15 months

No membership fees

Benefits of Using Credit Cards for Young Adults

A lot of young people find credit cards confusing and even scary. But credit cards are part of our daily lives, and there are many advantages to having one.

Building Credit

One of the main reasons why young people get credit cards is to start building good credit, which is essential for achieving financial stability in life. Bearing in mind that you can’t get loans without a good credit score, it’s important to get a credit card for building credit.

Start slow, with smaller purchases that you know you won’t have any problem paying off, and gradually work your way towards bigger, more expensive purchases. You’ll get to a good score in no time.

Reap the Rewards

Today, a lot of credit cards come with incentives in the form of cashback or airline rewards programs. This is why many people have multiple credit cards in their wallets.

One card is netting them cashback in grocery stores, while another gets them accommodation deals when they travel. Every card comes with a different rewards plan, so pick them according to your needs.

Track Your Spending

The best first-time credit card wouldn’t be so great if it just enabled you to spend thousands of dollars and bury yourself in debt. Each of these cards records every single purchase you make, providing you with a complete history of your transactions and serving as a useful tool during tax season.

FAQ

What is the best credit card for someone just starting out?

There are many great credit card options for people who have never used them before. The ideal cards are those that don’t require a good credit score, have low or zero deposit requirements, and offer plenty of rewards. Using one of these cards is also the fastest way to build your credit.

What’s the best credit card for a 19 year old?

The best credit cards for 18-year-olds and other young adults should come with no annual fees and, if possible, be secured. Look for cards that don’t require a high credit score. Many young adults are prevented from getting a credit card because of credit requirements.

Should young adults get credit cards?

Credit cards can help young adults build their credit score and learn how to manage their finances by developing smart spending habits. They can also take advantage of the many rewards programs credit card companies offer.

What is the best age to get a credit card?

Many experts argue that 18 is the perfect time to get one of the best credit cards for young adults. Others believe that you should wait a few years until you are competent enough to handle financial responsibilities like tuition fees and rent.