Leveling up Your Credit Game
Credit scores. They’re those pesky three-digit numbers that can either be a gateway to financial freedom or a barrier keeping you from it. We know it can be intimidating, but here's the good news… with the right strategy and tools, you can absolutely boost that score.
Whether you’re a recent grad looking to get your first credit card or a finance newbie trying to bounce back from a few mistakes, don't worry, we got you. In this blog, we'll round-up some of the most popular credit cards that could help you build credit.
Plus, we’re going to introduce you to an alternative option… The Credit Builder Card1.
It’s time to level-up your credit game and take control of your financial future.
Let’s get into it 💳
What Is a Secured Credit Card?
Equifax explains that a secured credit card is a type of card that requires a cash deposit—usually equal to your credit limit–to be made when you open the account. This money then acts as collateral every time you make a purchase.
The Credit Score: Why it Matters
Before we jump into the juicy part, let's talk through why your credit score is important.
Your credit score is like your financial GPA, the three-digit number that can make or break your loan approvals, interest rates, insurance premiums, and even job opportunities. Boosting your credit score is like acing your report card, and one of the best ways to do this is by using credit cards to build credit.
Lenders use your credit score to decide whether to lend you money. If you’ve ever been rejected for credit, knowing and understanding your credit report can help you figure out why your score may be lower than required.
Your credit report is an important document that contains information about your credit history and financial behavior. Try to review your report regularly to make sure the information is accurate and to monitor your credit score.
In case you didn't know, you're entitled to a free credit report from each of the three major credit bureaus (Equifax, Experian, and TransUnion) once a year.
To find out how, head over to How to Get a Free Credit Report 💗
How Can Secured Credit Cards Build Credit?
So, how can credit cards build credit? It's simple, really. Each time you make a payment on your credit card, the card issuer reports it to the credit bureaus. This information forms part of your credit history, influencing your credit score. Consistent, timely payments = a credit score glow-up 💅
Unveiling the Secured Credit Cards to Build Credit
So, are you ready to start the journey towards a better credit score? Here are some of the best credit cards to build credit.
1) Cleo: The Credit Builder Card
Let us introduce you to ✨ The Credit Builder Card1 ✨
Cleo offers an AI-driven approach to personal finance. The Credit Builder Card is designed specifically for those looking to build credit from scratch or improve their existing credit score.
Unlike traditional credit cards, Cleo's card requires a $1 security deposit. Plus, Cleo can offer personalized advice on your spending habits, which can help you avoid going over budget.
Each time you make a payment using the Credit Builder Card, it's reported to all three major credit bureaus. This means your good habits could, over time, translate into a better credit score.
Interested? Check out How to Build Credit History with The Credit Builder Card.
2) Capital One Secured Mastercard
The Capital One Secured Mastercard is a popular option for those wanting help with building credit. This card offers an initial credit line of $200 with a refundable minimum security deposit of $49, $99, or $200. One perk of this card is that it can give you access to a higher credit line after making your first five monthly payments on time.
3) Discover it Secured
Another popular choice among credit cards to build credit is the Discover it Secured card. This card doubles as a rewards card, allowing you to earn cash back on every purchase. Plus, after eight months, Discover starts automatic monthly reviews of your account to see if you qualify for an upgrade to an unsecured card.
4) OpenSky Secured Visa Credit Card: This card could be a good option for people with no credit or poor credit, as there's no credit check required when you apply. You determine your own credit limit based on the amount you secure with a one-time, refundable deposit.
Ready to start living your best credit life?
How to Utilize Secured Credit Cards to Build Credit
Knowing which secured credit cards to build credit is only half of the battle. The key to boosting your credit score is using these cards wisely.
Pay On Time: Paying your credit card bill on time is the single most effective way to build credit. Even one late payment can take a toll on your credit score.
Keep Balances Low: Your credit utilization rate (the percentage of your total credit limit you're using) should stay below 30%.
Avoid Multiple Applications: Applying for too many credit cards in a short time can lower your credit score. Stick to one or two secured credit cards to build credit and use them responsibly.
Enjoy this post? Give it a share or send it along to a friend. You never know, it could make a big difference. Big love. Cleo 💙
1The Credit Builder Card is issued by WebBank, Member FDIC pursuant to a license from Visa USA Inc. Access to the Card is subject to approval.