Best Cards Summary
Chase Freedom Flex℠
Why this is one of the best credit cards for young adults: Chase Freedom Flex delivers 5% cash back on up to $1,500 each quarter in rotating bonus categories you activate. You’ll also earn 5% back on travel purchased through Chase, 3% back at drugstores and restaurants – including takeout and delivery – and 1% back on all other purchases year-round. See our full review.
Chase Freedom Unlimited®
Why this is one of the best credit cards for young adults: Chase Freedom Unlimited charges no annual fee. The card earns 5% cash back on travel purchased through Chase Ultimate Rewards, 3% cash back on dining and drugstore purchases and 1.5% cash back on all purchases. But you’ll need good to excellent credit. If you get a card and spend $500 within three months of opening it, you can earn a $200 bonus. See our full review.
Bank of America® Cash Rewards Credit Card for Students
Why this is one of the best credit cards for young adults: This card offers flexibility with earning rewards, offering 3% cash back on a choice of gas, online shopping, dining, travel, drugstores, or home improvement and furnishings. Purchases at grocery stores and wholesale clubs earn 2% cash back, and all other purchases earn 1% back. The 3% and 2% cash back rewards apply to the first $2,500 in combined card purchases each quarter; thereafter, you’ll earn 1% back until the next quarter. Cardholders do not pay an annual fee. See our full review.
Discover it® Student Cash Back
Why this is one of the best credit cards for young adults: Even young adults with fair credit or who are new to credit may qualify for this student card. Cardholders can earn 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate. The card offers unlimited 1% cash back on all other purchases. There’s no annual fee and no late fee the first time you pay late. At the end of your first year as a cardholder, Discover will match all the cash back you’ve earned. The card also provides free access to your FICO credit score and charges no annual fee. See our full review.
Discover it® Student chrome
Why this is one of the best credit cards for young adults: This card is designed for students who primarily spend on gas and dining. Cardmembers earn 2% cash back at gas stations and restaurants, on up to $1,000 in combined purchases each quarter. All other purchases earn unlimited 1% cash back. Discover will match all the cash back you’ve earned after your first year. See our full review.
Discover it® Cash Back
Why this is one of the best credit cards for young adults: The Discover it Cash Back offers 5% cash back each quarter in rotating categories, such as Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate. All other purchases earn unlimited 1% cash back. There is no annual fee. At the end of your first year as a cardmember, Discover will match all the cash back you earned. See our full review.
Discover it® chrome
Why this is one of the best credit cards for young adults: This card caters to consumers who want to earn cash back on gas and dining purchases. You’ll earn 2% cash back at gas stations and restaurants on up to the first $1,000 in combined purchases quarterly. After that, you’ll earn 1% back, along with unlimited 1% cash back on all other purchases. There’s no annual fee and rewards never expire. See our full review.
Bank of America® Travel Rewards Credit Card for Students
Why this is one of the best credit cards for young adults: Young adults can earn 1.5 points per dollar spent on all purchases with no caps. You can redeem points for statement credits toward flights, hotels, rental cars, vacation packages and other travel expenses, and blackout dates or restrictions do not apply. If you make at least $1,000 in purchases within the first 90 days of opening an account, you can earn 25,000 bonus points. The card charges neither an annual fee nor a foreign transaction fee. See our full review.
Chase Sapphire Preferred® Card
Why this is one of the best credit cards for young adults: With the Chase Sapphire Preferred Card, you will get two points per dollar on travel and dining purchases and one point per dollar on other purchases. Spend $4,000 within three months of opening the card, and you’ll earn 100,000 bonus points worth $1,250 when you redeem them for travel through the Chase Ultimate Rewards portal. See our full review.
Wells Fargo Cash Back College Card
Why this is one of the best credit cards for young adults: College students who are new to credit can earn 3% cash back on up to $2,500 in gas, grocery and drugstore purchases made in the first six months with this card. Other purchases earn 1% cash rewards, plus the card charges no annual fee. Students also have access to free credit management tools through Wells Fargo online. See our full review.
Do Young Adults Need Credit Cards?
Credit cards have their drawbacks, of course. You risk piling up debt and paying interest charges if you don’t pay off your card balance.
Failing to use a card responsibly could damage your credit.
Like a bank account, a credit card is a financial tool that young adults should learn how to use well. Dipping your toes into the credit card world as a young adult can help you establish good credit habits for a lifetime.
How Old Do You Have to Be to Get a Credit Card?
You might not be able to get a credit card on your own if you are under 21. Federal rules prevent issuers from offering credit cards to consumers under 21 unless they meet certain requirements.
If you are under that age and want a card, you must submit a written application showing you have the income to make minimum payments or have a co-signer.
What Is the Best Credit Card for Beginners?
Young adults new to credit cards should focus on building credit. A good starter credit card to build credit will report your account activity to the three major credit bureaus and be easy to manage.
Nearly all credit cards report your account activity, so ease of use is typically the differentiating factor. What makes credit cards easy to use?
Look for cards with no or low fees, clear rewards programs, and alerts to help you remember to pay your bill and avoid overspending.
Cards may also come with other benefits and protections. Your card may have a zero fraud liability policy, which means you are not responsible for fraudulent charges.
Other credit card protection benefits may include extended warranty coverage, price protection, purchase protection and travel insurance.
What Is the Easiest Credit Card to Get With No Credit?
Young adults with no credit have limited card choices because most credit cards require good or excellent credit. Still, you have options, such as secured credit cards.
Secured credit cards are for consumers with no credit history. You’ll pay a security deposit ranging from $50 to $200, which is often equal to your credit limit.
When you close the account or upgrade to an unsecured card, you will get the deposit back. An unsecured card – usually a basic card with a low bar for approval and no security deposit – may be an option if you have fair credit or better.
Young adults in college should consider student credit cards for building credit. This type of card often has no annual fee, may earn rewards and could offer free access to your FICO credit score.
Another card to consider if you’re having trouble getting approved for a secured card or student card is a retail card from a store where you shop often. But these cards have high APRs, so don’t get a retail card unless you vow to never, ever carry a balance.
How Long Does Building Credit Take?
For a FICO credit score, you will need at least one account open for six months or longer. A VantageScore takes one month of credit activity.
Paying your bills on time and using 30% or less of your credit limit can help you build a good credit history quickly. You can boost your score more quickly by using 10% or less of your credit limit.
The age of your accounts is also a factor in credit scoring; the older, the better. As a result, the first card you open is one you’ll want to keep for a long time.
How Should Young Adults Use Credit Cards?
Building credit and learning how to manage credit are the main goals of most young adults using credit cards. These practices can help you get off to a strong start.
Choose a credit card you can manage. Credit card offers can be attractive, with some touting over-the-top bonus rewards and cardholder benefits. But high-value cards aren’t necessarily for beginners.
Select a card you know you can handle. For many young adults, a credit card with no annual fee and simple cash back rewards can be a good fit.
Pretend that your credit card is a debit card. Keep in mind that your credit limit isn’t your budget. Set up a budget and track spending so you know how much you can afford to spend – and pay off – each statement period. Carrying a balance means paying interest charges and could lead to piling up debt.
Stick to 30% credit utilization or lower. Your credit utilization ratio, or the amount of credit you are using compared with your credit limit, should be 30% or less. On a credit card with a $500 credit limit, 30% is $150.
Use rewards and benefits. Racking up rewards and enjoying cardholder perks might not be your top goals as a young adult building credit, but if you’ve got rewards and perks, use them. Redeem rewards as cash back deposits in a bank account, as gift cards or as statement credits.
Treat credit cards as a learning experience. You might make mistakes with credit cards – like paying your bill late or blowing your budget – but you can bounce back. Learn from any mistakes and resolve to improve your credit card habits as you get more practice using credit.
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