What is the Best First Credit Card to Have
Applying for your first credit card is a huge financial achievement but it is also a delicate one. The first card you pick can easily determine how well your credit record is going to be for the rest of your life. Start with the wrong card and you’ll find yourself accumulating hundreds or even thousands of dollars in fines and other penalties which will damage your credit record significantly. If on the other hand, you get the best first credit card, your credit record and history in overall will blossom helping you to secure better credit cards in future.
Getting a credit card with no credit history isn’t that easy either. Without a credit history, a lot of companies don’t really know your creditworthiness and this limits how much they are willing to offer. Some companies are even known to avoid people with no credit history altogether and the few that are willing to offer the cards do so with stringent terms.
This shouldn’t worry you so much though because the purpose of a first credit card is not just to sort you out financially but also to help you build your credit record.
Sadly, not all credit cards make the best first cards. Don’t get caught up with all the advertisements and stuff and lose sight of what really matters when looking for your first credit card. We, usually advise everyone to look out for three key qualities before considering any credit card.
a. Annual Fees
Your first credit card shouldn’t have any annual fees. Credit card history matters a lot when gauging your overall credit card record. Having such a card, therefore, allows you to own and keep the card open for as long as you want without closing the card. You can hence apply for other cards and still retain your first credit card at no fee. This will extend your good credit history for a longer time.
Very few credit cards offer rewards to people with no credit history. You should do your best and get a credit card with decent reward programs. Some of these cards will give you as much as 5% cash backs on purchases done at gas stations while others offer between 1% to 2% on purchases at grocery stores and other categories.
These programs are a good way of earning some of your money back.
c. Additional Features
The credit marketplace is highly competitive and this pushes companies to offer unique features to get people signing up. You need to read through all the features of a credit card you are eyeing before completing your application. Features such as free credit monitoring can be very useful. Others offer educational tools that can teach you how to use a credit card responsibly and to improve your credit score. Some cards also don’t charge anything in form of foreign transaction fees and these are very useful for people who travel a lot.
While going through the additional features offered by the credit card, you should try and inquire about the process of upgrading. Your first credit card is important but the moment you boost your credit score, getting a better card should be your first priority. If possible, get your first credit from a company that will be willing to upgrade you to a better card with improved terms in the most efficient way possible.
Top 3 Best First Credit Card
The following cards make up the top three credit cards for first timers in the market. You must also ask yourself what exactly it is you are looking for in the card because these cards outdo each other in certain categories.
1. Chase Sapphire Preferred Card
The Chase Sapphire is an incredible credit card that comes with lots of perks that most first-timers will find interesting. Spend more than $4,000 within your first three months and you will get 50,000 ultimate rewards points! The company also works with more than 13 partners to whom you can transfer the points and redeem them to get different products or services. There is also an option of redeeming the points directly through Chase’s travel point.
The Chase Sapphire Preferred Card also offers trip delay protection and primary car rental coverage. The lack of foreign transaction fees also makes the card an excellent choice for everyone who travels a lot.
The only thing that you might have a problem with is the $95 annual fee. The good news is you will receive a waiver for this fee in your first year. This should give you enough time to determine whether the card is worth having.
2. Bank of America Travel Rewards Credit Card
Use at least $1,000 in the first 90 days of acquiring the Bank of America Travel Rewards Credit Card and you will get 20,000 online bonus points. You can redeem these points to get $200 statement credit that you can use for your travel purchases.
One of the things that make this card stand out from the rest is the flexibility you get with the points you earn here. These points can be redeemed not just for flights but also for cruises, baggage fees, rental cars etc.
Another perk with owning this card is the fact that they don’t charge any foreign transaction and annual fees. Yes, unlike the Chase Sapphire Preferred Card and most other credit cards in the market, this card doesn’t come with any annual fees.
If you are already a customer of Bank of America, you will still get all the discussed incentives of this card but the bonuses will be delivered in form of additional points and not cash back.
3. Discover it Student Cash Back
The Discover it Student Cash Back is an excellent choice to people with limited to no credit history. The card has a 5% cash back reward which ranks it up there among the best credit cards in the market. This cashback can be earned on various purchases including gas, grocery store, wholesale clubs, restaurants etc. to the quarterly maximum every time you activate.
The best part? Discover will match your cash back after your first 12 months!
Yes, if you are a new customer, Discover will double up all the cash back you earn in your first year and include the total in your credit card.
Holders of this card will also get access to their FICO credit score. This is very important for all first timers as it helps in monitoring their progress. You can take note of all lending behaviors that might be damaging to your record and rectify them before it’s too late.
Discover it Student Cash Back also doesn’t charge an annual fee.
Just because a credit card has lots of perks doesn’t mean that it is right for you. Why is that? Well take the Bank of America Travel Rewards Credit Card, for instance, this card has excellent incentives which can only be enjoyed by travelers. If therefore, you don’t spend a lot of time on the road, this card will not be your best pick.
To get the best credit card that fits your lifestyle and overall expectations, you must know your spending habits. Take note of where you spend most of your money on and use that information to get an appropriate credit card. This should help make your life easier while improving your credit record at the same time.