Best Credit Cards For Young Adults
These days credit is easy to come by however using it sensibly and responsibly is a skill you should learn if you want to play the game. A common question when young people come of age is;
What are the best credit cards for young adults?
Hold on a sec, before we answer this question we need to hit a few home thruths. Just because you are old enough to borrow does not mean it is a good idea to apply for a credit card.
You should at least wait until you have a job that pays you a full time income. Otherwise you are exposing yourself to a whole world of trouble if you are not disciplined enough in paying back the debts.
Establish A Credit History First
An important criteria is to build a good credit record. To do that you need to have a credit history otherwise credit card companies will not touch you. For young people looking for their first credit card this can be a catch 22 situation. An alternative way to get around this issue is to ask your parents if they can make you an authorized user on their credit card. In this way you can start building your credit history right away.
If you have used a credit card before then, you will have at least built up a certain level of credit history. This will at least get your foot in the door. Your life will also be made considerably easier if you've built up a good credit record by paying your outstanding balances when they are due, spending within your means and not maxing out on your credit limits.
What To Look For In A First Time Credit Card
Young people will be at a disadvantage due to the length of their credit history. This means that the choice of cards available will be limited. The good news is that banks and credit card companies are very keen to bring in new customers especially if they are young with an unblemished when it comes to debt.
Even with little to no credit history lenders are more willing to accept you compared to someone who has acquired the habit of missing payments and defaulting on their debts. The best level entry or first time credit cards for young adults are the student cards.
For a first timer you will want to paying off your balances each month and on time. This is the best to build a good credit history. However, if there are certain months where you think you can only make the minimum monthly payments then you need to look for cards with the lowest interest rates possible.
Again, you want to keep these down to a minimum. Before choosing a card look any hidden charges or annual fees. You want a card without any however, for entry-level cards there is usually a annual fee.
With entry level and student credit cards there are slim pickings on the air travel and rewards front. However, more and more card issuers are giving young people and students a break. For example, the Discover Student credit card range have similar cash back offers to their mainstream cards.
The Discover More Card
The best credit card for young adults that comes closest to meeting the above criteria is the Discover More Card. This little baby has low maintenance features, 0% introductory periods that keep more money in your pocket. These benefits kick off with the following:
- No annual fee
- 0 % APR on purchases for 6 months - regular APR is variable between 11.99%-19.99%.
- 0% APR on balance transfers for the first 18 months
- 5% cash back bonus rewards when you use the card in restaurants, department and clothes stores
- Up to 1 % cash back bonus reward on all other purchases.
Other Options Available
If you have no credit history or it's not as healthy as you would like, do not despair. There are still options available such as the Orchard Bank® Classic MasterCard®. In your situation you got to expect that borrowing is going to cost you more especially with a less than good credit rating.
With the Orchard Bank there is a $74 annual fee which drops to a low $35 in the second year for good behaviour. The APR range is between 7.90% and 28.90% and offers balance transfers. With this card all you have to do is build good credit.
Use it wisely, don't over extend your limit, pay in full and on time and in a year or two you can graduate to a different card with more attractive features. And, to help you achieve this the Orchard Bank® card offers an email and text service to remind you when your monthly payments are due.
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