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A credit card is usually the first entry on most young adults' credit reports, but many find it challenging to get approved for that first card. You might be comparing a student vs. secured credit card because both tend to have an easier approval process.
Lenders are often hesitant to work with young adults because there's less data to indicate how they'll handle the responsibility. Fortunately, student and secured credit cards are two types of credit cards that you can qualify for even if you don't have any credit history to your name. So, looking at a student vs. secured credit card, which is better?
When choosing between a student vs. secured credit card, here's how to decide on the best option for your situation.
One of the main differences between a student vs. secured credit card is that student credit cards are designed specifically to help college students establish a credit history. They work like regular credit cards, but they're much easier to qualify for. You don't need a certain credit score -- or any credit history at all, for that matter.
However, you do need to be at least 18 and provide proof that you're enrolled full-time or part-time in a qualifying university to get a student credit card. You'll also have to show proof of income, even for a student card. A part-time job is fine in most cases. The card issuer just wants to be sure that you have a means to pay back what you owe.
The best student credit cards offer rewards just like regular credit cards. And when it comes to a student vs. secured credit card, a student credit card is more likely to offer some rewards. But don't expect to rake in hundreds of dollars in cash back or airline tickets. Student credit cards typically have lower credit limits -- often $1,000 or less. So if your student card offers 1% cash back on purchases, the most you'd earn in a month would be $10 in cash rewards. This is disappointing to some, but remember: You're not getting a student credit card for the rewards. You're getting it so you can establish yourself as a responsible payer and start building credit.
Some card issuers will automatically increase the credit limit on a student credit card after a few months of full, on-time payments. If they don't do this automatically, you can ask an issuer for a credit limit increase. When you graduate, many student card issuers will upgrade you from a student credit card to a regular credit card, either automatically or at your request. Ideally, at that point, you'll have established enough of a credit history that you can apply for other credit cards that interest you as well.
If you're interested in a student credit card, take a look at a few of our favorite ones below. You can also check out our full list of the Best Student Credit Cards for more options.
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Discover it® Student Chrome | Bank of America® Travel Rewards credit card for Students |
Rating image, 4.75 out of 5 stars.
4.75/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best = Excellent = Good = Fair = Poor |
Rating image, 5.00 out of 5 stars.
5.00/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best = Excellent = Good = Fair = Poor |
Apply Now for Bank of America® Travel Rewards credit card for Students
On Bank of America's Secure Website. |
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Credit Rating Requirement:
Falling within this credit range does not guarantee approval by the issuer. An application must be submitted to the issuer for a potential approval decision. There are different types of credit scores and creditors use a variety of credit scores to make lending decisions.
Recommended Credit Score required for this offer is: Fair/New to Credit Under(669)
Fair/New to Credit Under(669) |
Credit Rating Requirement:
Falling within this credit range does not guarantee approval by the issuer. An application must be submitted to the issuer for a potential approval decision. There are different types of credit scores and creditors use a variety of credit scores to make lending decisions.
Recommended Credit Score required for this offer is: Good/Excellent (670-850)
Good/Excellent (670-850) |
Welcome Offer: N/A Discover will match all the cash back you’ve earned at the end of your first year. |
Welcome Offer: 25,000 online bonus points after you make at least $1,000 in purchases in the first 90 days of account opening - that can be a $250 statement credit toward travel purchases 25,000 points |
Rewards Program: 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. 1% unlimited cash back on all other purchases - automatically 1% - 2% Cashback |
Rewards Program: Earn unlimited 1.5 points per $1 spent on all purchases, with no annual fee and no foreign transaction fees and your points don't expire as long as your account remains open. 1.5 points per dollar |
Intro APR: Purchases: 0%, 6 months Balance Transfers: 10.99%, 6 months |
Intro APR: 0% Intro APR for 15 billing cycles for purchases. 0% Intro APR for 15 billing cycles for any balance transfers made in the first 60 days. After the intro APR offer ends, 19.24% - 29.24% Variable APR on purchases and balance transfers will apply. A 3% fee for 60 days from account opening, then 4% fee applies to all balance transfers. Purchases: 0% Intro APR for 15 billing cycles for purchases Balance Transfers: 0% Intro APR for 15 billing cycles for any balance transfers made in the first 60 days |
Regular APR: 18.24% - 27.24% Variable APR |
Regular APR: 19.24% - 29.24% (Variable) |
Annual Fee: $0 |
Annual Fee: $0 |
Highlights:
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Highlights:
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Apply Now for Bank of America® Travel Rewards credit card for Students
On Bank of America's Secure Website. |
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Secured credit cards aren't designed just for students, but they can be a good way for young adults to build their credit if they don't qualify for a student credit card. When it comes to a student vs. secured credit card, while they're both easier to qualify for, a secured credit card is generally more likely to accept an applicant with poor credit.
It's called a secured card because it requires a security deposit. This amount is usually equal to your credit limit. It starts around $200, but you might be able to put down more if you want a higher credit limit on your secured card. If you fail to pay back what you owe, the card issuer will keep your security deposit. But as long as you keep up with the payments, the company will refund your deposit if you ever close your secured card.
The security deposit lessens the risk to card issuers, so you don't need a good credit score to apply for one of these. In fact, you might get approved if your score is under 600. But these cards tend to carry a high interest rate, often higher than 20%, so they can hurt you if you carry a balance from month to month. That said, when comparing a student vs. secured credit card, they're both likely to come with a high APR. You should avoid carrying a balance on either. One perk of the secured card, especially if you have trouble managing your spending, is the low credit limit -- it's impossible to fall into too much credit card debt.
Rewards among secured credit cards are rare, but the best secured credit cards do offer limited rewards and perks. like a low cash back rate or free credit score. As with student credit cards, however, the low credit limit on secured credit cards doesn't allow for high rewards-earning potential. Once you've proven yourself to be a responsible payer, your card issuer may automatically consider you for an upgrade to a regular credit card, or you can request one yourself. Once this happens, your security deposit will be refunded.
Here are a few secured cards that might be a good fit for you. To see more of our favorites and learn what they have to offer, take a look at our list of the Best Secured Credit Cards.
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Capital One Platinum Secured Credit Card | Discover it® Secured Credit Card |
Rating image, 4.00 out of 5 stars.
4.00/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best = Excellent = Good = Fair = Poor |
Rating image, 5.00 out of 5 stars.
5.00/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best = Excellent = Good = Fair = Poor |
Apply Now for Capital One Platinum Secured Credit Card
On Capital One's Secure Website. |
|
Credit Rating Requirement:
Falling within this credit range does not guarantee approval by the issuer. An application must be submitted to the issuer for a potential approval decision. There are different types of credit scores and creditors use a variety of credit scores to make lending decisions.
Recommended Credit Score required for this offer is: New/Rebuilding Under(579)
New/Rebuilding Under(579) |
Credit Rating Requirement:
Falling within this credit range does not guarantee approval by the issuer. An application must be submitted to the issuer for a potential approval decision. There are different types of credit scores and creditors use a variety of credit scores to make lending decisions.
Recommended Credit Score required for this offer is: New/Rebuilding Under(579)
New/Rebuilding Under(579) |
Welcome Offer: N/A N/A |
Welcome Offer: Discover will match all the cash back you’ve earned at the end of your first year. |
Rewards Program: — |
Rewards Program: 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. 1% unlimited cash back on all other purchases - automatically 1% - 2% Cashback |
Intro APR: Purchases: N/A Balance Transfers: N/A |
Intro APR: Purchases: n/a Balance Transfers: 10.99%, 6 months |
Regular APR: 29.99% (Variable) |
Regular APR: 28.24% Variable APR |
Annual Fee: $0 |
Annual Fee: $0 |
Highlights:
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Highlights:
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Apply Now for Capital One Platinum Secured Credit Card
On Capital One's Secure Website. |
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Show More Show Less |
When it comes to choosing between a student vs. secured credit card, student credit cards are often the better choice if you qualify. Many don't charge an annual fee, and you don't have to put a deposit down. But if you don't qualify for a student credit card, either because you're not enrolled in college or because you already have some bad marks on your credit report, a secured credit card is a good alternative. Look for one with no annual fee and a low security deposit.
As you make your choice between a student vs. secured credit card, it's important to use your new card responsibly and avoid credit card debt. If you stay below your credit limit and make all your payments on time, a credit card can go a long way toward improving your credit score. But it could just as easily ruin your credit if you skip your monthly payment or regularly spend up to your credit limit.
Here are some other questions we've answered:
We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent, a Motley Fool service, does not cover all offers on the market. The Ascent has a dedicated team of editors and analysts focused on personal finance, and they follow the same set of publishing standards and editorial integrity while maintaining professional separation from the analysts and editors on other Motley Fool brands.