There is a huge stigma attached to secured credit cards. Many consumers believe that they are only for those who have bad credit and can’t get another credit card. The truth is that this is just not the truth. Many people have no credit, have low credit scores because of a lack of credit and need to build their credit scores so that they can apply for more credit later on. It’s not just for those who have made mistakes with their finances in the past. It’s for everyone who has to build their score; for good reasons or bad ones. Secured credit cards report your activity to the credit bureaus so that you can improve your credit score and eventually apply for unsecured cards that will help you build even more credit, improve your score and become more financially stable. Anyone, whether you have horrible credit or no credit at all, can apply for a secured credit card and get it. That’s the benefit of this card. And for anyone considering a card like this in the New Year, we have a few cards that will make it very easy for you to save money and build your credit score at the same time.
Wells Fargo Secured Card
There are some really beneficial features to this particular card. While your deposit of anywhere from $300 to $10,000 does not earn interest, you will get it back when you are done with this card and move on to an unsecured card. This card allows you to make payments and receive good notices to the credit bureaus, and the annual fee is actually only $25. It’s one of the lowest annual fees around. With an interest rate just higher than 18%, it’s not a bad card to have. Additionally, this is a card that allows you to make balance transfers from other cards, which not many secured cards do.
US Bank Secured Card
This is one of the best secured cards on the market for several reasons. We will start with the annual fee, which is only $35. It’s average, but it’s much lower than many. You can choose to put down anywhere from $300 to $5000 to establish your credit limit. The interest rate is a bit high, but that happens when you don’t pay off your card; pay it off in full each month and that won’t matter. The money savings really comes into play with you consider that your deposit is put in an interest-bearing account that you will one day get back with interest. Additionally, you will also get to save money on many things such as car rentals when you travel. This means big savings all while boosting your credit.
BankAmericard Secured Card
If you make all your payments on time and you have a good history for one year with this card, you will receive your deposit back and you will be able to use this card as an actual unsecured credit card after only 12 months. That’s a really nice benefit to have with a secured card. The card is pretty average in terms of what it has to offer otherwise, but that particular benefit makes it a nice card to have when you are in need of some severe financial restructuring. The annual fee is $39, which might be a bit higher than other cards, but it’s not that high or that bad. You can make balance transfers, which is always nice. Additionally, the APR is just over 20%. One late payment with this card, however, and you will see your interest rate spike to 29.99% and your ability to use this card as an unsecure card in the future look a little less bright. This card makes it very easy to rebuild or build your credit, and it’s worth the slightly average fees with the quick promise of an unsecured credit card.
Merrick Bank Secured Visa
You get to choose to put down as much or as little as you want with this card. You can choose to put down $200 or you can choose to put down up to $3000 depending on what you want to use and what you feel comfortable with financially. The $36 annual fee is deducted from your initial balance, and the APR is quite low for a card like this coming in at just over 17%. This is a card that will allow you to qualify for periodic credit limit increases without additional money down as you make timely payments and get your card paid off in full as often as possible. It’s a great starter card that provides you with additional financial educational information so that you can make smarter decisions in the future.
Capital One Secured Card
For the most part, Capital One is a great issuer of credit cards. Their unsecured credit cards might be fairly average in terms of offers, but if you have low or no credit, it’s not something you should worry about. This is a secured card that is going to save you a lot of money while still helping you to build your credit. For example, this is a card that is going to allow you to pay only a $29 annual fee. Most secured cards charge cardholders far more than that every year, so savings start right away. Additionally, this card requires a down payment of $49, $99 or $200. It all depends on your credit what you have to pay, but it’s far lower than the typical $300 payment you have to make up front for many secured cards. Additionally, this is a card that is going to give you a very low credit limit of only $200 which is going to save you a lot of money and make it nearly impossible for you to go into debt in the future. After a while of making on time payments and paying off your balance, you will find that you can apply for an unsecured credit card.
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