Best credit cards for recent college graduates

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Graduating from college opens up an array of new possibilities. Although with them come some new responsibilities, like paying for all your living expenses and facing those student loan repayments, that aren’t so fun. Taking the reins in terms of your finances can give you a new sense of fulfillment as well as something to strive for.

One step you’ll probably want to take if you haven’t already is getting a new credit card. After all, you’ll want a positive credit history and the highest score possible if you plan on purchasing a home or you want to qualify for the best rates and terms when you borrow money for a car or any other purpose.

Unfortunately, not all credit cards are geared to new college graduates, and it’s possible you’ll need a secured credit card if you don’t have any credit history at all. To help you in your search for a new credit card, we highlighted the best unsecured and secured options for new college graduates who are in the midst of their journey to better credit.

Best for cash back

Capital One® QuicksilverOne® Cash Rewards Credit Card

  • Earn an unlimited 1.5% cash back on every purchase
  • $39 annual fee
  • Qualify with “average” credit
  • 26.99% variable APR on purchases

The Capital One QuicksilverOne Cash Rewards Credit Card is ideal for new college graduates with just average or fair credit. This typically means any FICO score of 580 or above, although consumers with scores of 670 or higher have a better chance of being approved. While this card does charge a $39 annual fee, you’ll earn a flat 1.5 percent back for each dollar you spend. Once you begin racking up rewards, you can redeem your cash back for statement credits in any amount you want.

Most importantly, this card may be attainable with imperfect credit. Your financial behavior will be reported to all three credit bureaus — Experian, Equifax and TransUnion — and over time, your positive credit history and on-time payments should help increase your score. With a better score you can upgrade to a new rewards credit card with better perks.

Who should sign up for this card? The Capital One QuicksilverOne Cash Rewards Credit Card is best for college graduates with just “okay” credit who want to earn rewards while they work on building a positive credit history that lasts.

Best for debt consolidation

Amex EveryDay® Credit Card from American Express

  • Earn 2x Membership Rewards points on up to $6,000 spent at U.S. supermarkets each year (then 1x points) plus 1x points on everything else
  • Earn 20% in bonus rewards each time you make at least 20 purchases on your card within a billing period
  • Earn 10,000 Membership Rewards points when you spend $1,000 on your card within three months of account opening
  • Qualify for 0% APR on purchases and balance transfers for 15 months, followed by a variable APR of 14.49% to 25.49%; no balance transfer fees for transfers initiated within 60 days of account opening
  • Terms apply

If you have some high interest debt you want to consolidate, the Amex Everyday® Card from American Express is worth considering if you believe you can get approved. This card is available to consumers with good or excellent credit, yet it comes with one of the best  introductory APR offers available on the market today.

To start things off, you can earn 10,000 valuable Membership Rewards points when you spend $1,000 on your card within three months of account opening. You’ll also get 2x points on up to $6,000 in spending at U.S. supermarkets each year (then 1x points) and 1x points on all other purchases. If you’re a daily card user, you can also rack up considerably more rewards with this card’s 20 percent in bonus rewards each time you use your card for at least 20 purchases within a billing period.

Consider consolidating debt on this card, since you’ll get zero percent APR for 15 months on purchases and balance transfers (14.49 to 25.49 percent variable APR thereafter), and since there are no balance transfer fees for transfers initiated in the first 60 days.

With all these benefits in mind, this card is best for college graduates who have some high interest credit card debt to consolidate or those who want to earn rewards and pay down a large purchase over time without any interest.

The information about the Amex EveryDay Credit Card from American Express has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer.

Best for dining and entertainment

Capital One® SavorOne® Cash Rewards Credit Card

  • Earn 3% back on dining and entertainment, 2% back at grocery stores and 1% back on other purchases
  • Qualify for a $150 cash bonus when you spend $500 on your card within three months of account opening
  • No annual fee
  • 0% intro APR on purchases for 15 months, followed by a variable APR of 15.49% to 25.49%

The Capital One® SavorOne® Cash Rewards Credit Card does recommend good to excellent credit to get approved, but you’ll be able to earn an exceptional rate of rewards and access some pretty decent card benefits. For starters, you’ll earn 3 percent back on dining and entertainment, 2 percent back on grocery store spending and 1 percent back on all other purchases without any annual fee. You’ll also have the ability to earn $150 when you spend $500 on your card within three months of account opening, which is pretty standard among cash-back credit cards with no annual fee.

Not only will you be able to continue building up your credit score, but you can qualify for zero interest for a limited time on purchases. Specifically, you’ll get 0% APR on purchases for 15 months, followed by a variable APR of 15.49% to 25.49%.  This card doesn’t charge any foreign transaction fees and you can redeem your rewards for cash back in any amount you want.

Best for building credit from scratch

Discover it® Secured

  • Earn 2% back on up to $1,000 in combined restaurant and gas station spending per quarter (then 1%) plus 1% back on other purchases; Discover will also match all the rewards you earn at the end of your first year
  • No annual fee
  • Requires a refundable cash deposit
  • Reports to all three credit bureaus

If you have a very limited or non-existent credit history, it’s possible you’ll have to get started with a secured credit card. Unlike unsecured cards, secured cards require an initial cash deposit to secure a line of credit. If you make a cash deposit of $500 upfront, for example, you’ll normally get access to a line of credit in that same amount. Just remember that, while the deposit requirement seems harsh upfront, you’ll get your full deposit back if you close or upgrade your account in good standing and stay out of default. Discover will also begin reviewing your account after eight months to see if you qualify for an unsecured card.

The Discover it® Secured is an exceptional secured card option since, unlike some competing cards, it doesn’t charge an annual fee. You’ll also earn rewards on your spending, and Discover will match all your rewards at the end of your first year in what may be seen as a “delayed” signup bonus.

This card also reports your credit movements to the three credit reporting agencies, and you’ll get free access to your FICO score on your monthly credit card statements or online.

This card may not be ideal for everyone, since you need a cash deposit to get started, but you may need to start with a secured card if you can’t get approved for an unsecured credit card right away.

How to choose the best credit card for a recent college graduate

Before you opt for one of the credit cards on this list or another option you found elsewhere, there are some important factors you should consider. Here’s everything you need to think through before you apply.

  • Know your credit score. If you have an established credit history and a decent score, it’s possible you’ll be able to get approved for a top tier rewards credit card. With no credit history, however, you may be stuck with a secured credit card at first. Your first step should be to check your credit score so you know where you stand.
  • Think through your spending style. Most credit cards for college graduates offer some type of rewards, but they don’t all dole out points using the same rewards structure. If you spend a lot in certain categories like groceries, gas or entertainment, you may want to consider a card that offers rewards in these categories.
  • Make sure you’re going after the type of rewards you want. While pursuing rewards can be a smart move, you’ll want to make sure you’re earning the type of points you can benefit the most from. This might include cash back, airline miles, hotel points or even flexible rewards you can redeem in more than one way.
  • Ask yourself why you’re getting a credit card in the first place. Finally, consider what you hope to accomplish by getting a credit card and if you really need one. Since credit cards tend to come with exceptionally high interest rates, you may be better off with a personal loan or another financial product. Credit cards for college graduates can help you earn rewards and continue building a strong credit history, but they’re rarely the best option if you need to borrow money for the long haul.

What to know about credit cards after graduation

What kind of credit cards should recent college graduates sign up for?

Recent college graduates should look for an unsecured credit card that offers benefits and perks they’re interested in. This could mean looking at cash-back credit cards that help them earn a specific percentage in cash back on all their purchases, but it could also mean exploring general rewards credit cards or travel credit cards with unique perks.

Factors recent graduates should consider when looking for a credit card include – annual and ongoing fees, rewards programs and cardholder benefits.

What are the benefits of getting a credit card with a generous sign-up bonus?

Many of the top rewards credit cards let new customers earn lucrative bonuses when they sign up and meet a minimum spending requirement within the first few months. These offers can easily be worth $500 or more, so they’re worth signing up for if you have a reasonable number of expenses you can charge to a credit card each month.

Before opening a credit card with the goal of earning a sign-up bonus, make sure you understand the terms of the bonus. Also, make sure you can reach the minimum spending requirement using your normal spending and bills.

Can you still apply for a student credit card?

You can still apply for a student credit card after you graduate, but you may not want to if your credit score is good enough to qualify for a top rewards or travel credit card.

Student credit cards are geared to individuals with limited credit histories, so they tend to come with limited rewards programs and cardholder perks. If you can qualify for the best credit cards on the market today, you can earn a significant rate of return in rewards and choose your card based on the perks you want the most.