The Ultimate Guide to Credit Cards
Thursday, May 19, 2022

18 Best Credit Cards for 20- to 30-Year-Olds

Best Credit Cards For 20 To 30 Year Olds

credit card advice

Adam West

Written by: Adam West

Adam West

As Managing Editor for CardRates, Adam oversees content and regularly interviews some of the payments industry's biggest influencers and decision-makers so our site can bring high-quality and engaging stories to our audience and keep readers informed on the latest trends and technology in the space.

See full bio »

Edited by: Lillian Guevara-Castro

Lillian Guevara-Castro

Lillian is a Content Editor who brings her journalism experience in business and consumer finance to ensure CardRates news articles and reports have been edited for overall clarity, accuracy, and reader engagement. Her primary goal is to assure editorial content meets the highest level of quality and precision.

See full bio »
Advertiser Disclosure

In recent years, the term millennial has become almost a punch line for jokes about the younger generation, as well as a tag placed by marketers who want to capture the attention of this elusive group. But in the finance industry, this group is the most sought-after consumer demographic, accounting for more than $600 billion in spending this year alone. So, it’s no surprise that banks have created several cards to appeal to this demographic.

We’ve broken down the best credit cards for 20- to 30-year-olds based on categories and rewards popular among this group. We’ll explore cards specifically designed for students, cards with appealing cash back rewards, restaurant cards, travel cards, low interest cards, and cards for bad credit.

Students | Cash Back | Restaurants | Travel | Low Interest | Bad Credit | FAQs

Best “Student” Cards for 20- to 30-Year-Olds

College is hard. It’s even harder when you don’t have access to credit or immediate funds. Credit card issuers understand this and many offer cards that cater to a student’s spending needs and interests.

Many student cards offer statement credits for good grades, cellphone insurance, or other rewards and perks that add value beyond the obvious line of credit. As competition in this space heats up, the perks only grow sweeter and more valuable.

But keep in mind that you’ll need to show some sort of regular income to qualify for a student credit card. If you can’t provide that, you can still obtain some cards with the help of a cosigner. Just be sure to pay your bills on time to avoid potential embarrassment and financial hardship for the person who vouched for you on your application.

Discover it® Student Cash Back Review

at Discover Card'ssecure website

STUDENT RATING

★★★★★
4.6

OVERALL RATING

  • No credit score required to apply.*
  • INTRO OFFER: Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! So you could turn $50 cash back into $100. Or turn $100 into $200. There’s no minimum spending or maximum rewards. Just a dollar-for-dollar match.
  • Earn 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases – automatically.
  • No annual fee and build your credit with responsible use.
  • 0% intro APR on purchases for 6 months, then the standard variable purchase APR of 13.24% - 22.24% applies.
  • Refer-a-Friend: Once you become a Discover it® Student cardmember, you can earn a statement credit each time you refer a friend and they’re approved. Over half a million students got Discover Cards from their friends' recommendations.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% Intro APR for 6 months
10.99% Intro APR for 6 months
13.24% - 22.24% Variable APR
$0
Fair/New to Credit

STUDENT RATING

★★★★★
4.6

OVERALL RATING

4.2/5.0
  • Earn 1% cash back on all your purchases. Pay on time to boost your cash back to a total of 1.25% for that month
  • Earn $5 per month for 12 months on Select Streaming Subscriptions when you pay on time. *Exclusions Apply
  • Enjoy no annual fee and no foreign transaction fees
  • You can help build your credit with responsible use of a card like this
  • Be automatically considered for a higher credit line in as little as 6 months
  • $0 fraud liability if your card is ever lost or stolen
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
26.99% (Variable)
$0
Average, Fair, Limited
Discover it® Student chrome Review

at Discover Card'ssecure website

STUDENT RATING

★★★★★
4.6

OVERALL RATING

  • No credit score required to apply.*
  • INTRO OFFER: Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! So you could turn $50 cash back into $100. Or turn $100 into $200. There’s no minimum spending or maximum rewards. Just a dollar-for-dollar match.
  • Earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. Plus, earn unlimited 1% cash back on all other purchases – automatically.
  • No annual fee and build your credit with responsible use.
  • 0% intro APR on purchases for 6 months, then the standard variable purchase APR of 13.24% - 22.24% applies.
  • Refer-a-Friend: Once you become a Discover it® Student cardmember, you can earn a statement credit each time you refer a friend and they’re approved. Over half a million students got Discover Cards from their friends' recommendations.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% Intro APR for 6 months
10.99% Intro APR for 6 months
13.24% - 22.24% Variable APR
$0
Fair/New to Credit

While credit cards can make a student’s life easier, carrying debt past graduation isn’t the best way to enter the real world. The best thing you can do is to keep your balance low, pay your bills on time, and reap the benefits that come from building a positive credit history before most of your peers.

Best “Cash Back” Cards for 20- to 30-Year-Olds

There are many types of credit card rewards available to consumers, but in this financial space, cash is still king. That’s because you can spend cash however you wish, whereas travel or merchandise rewards may be of little value for certain consumers.

But not all cash back cards are equal. Some give back a flat percentage of your purchase, while others may offer higher rewards in specific categories or at certain times of the year, known as rotating categories. Our top-rated cards, listed below, offer the best of both worlds.

CASH BACK RATING

★★★★★
5.0

OVERALL RATING

  • INTRO OFFER: Earn an additional 1.5% cash back on everything you buy (on up to $20,000 spent in the first year) - worth up to $300 cash back!
  • Enjoy 6.5% cash back on travel purchased through Chase Ultimate Rewards®, our premier rewards program that lets you redeem rewards for cash back, travel, gift cards and more; 4.5% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and 3% on all other purchases (on up to $20,000 spent in the first year).
  • After your first year or $20,000 spent, enjoy 5% cash back on Chase travel purchased through Ultimate Rewards®, 3% cash back on drugstore purchases and dining at restaurants, including takeout and eligible delivery service, and unlimited 1.5% cash back on all other purchases.
  • No minimum to redeem for cash back. You can choose to receive a statement credit or direct deposit into most U.S. checking and savings accounts. Cash Back rewards do not expire as long as your account is open!
  • Enjoy 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 15.24% - 23.99%.
  • No annual fee - You won't have to pay an annual fee for all the great features that come with your Freedom Unlimited® card
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% Intro APR on Purchases 15 months
0% Intro APR on Balance Transfers 15 months
15.24% - 23.99% Variable
$0
Good/Excellent

CASH BACK RATING

★★★★★
4.9

OVERALL RATING

  • Earn 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases.
  • To earn cash back, pay at least the minimum due on time.
  • Balance Transfer Only Offer: 0% intro APR on Balance Transfers for 18 months. After that, the variable APR will be 14.74% - 24.74%, based on your creditworthiness.
  • Balance Transfers do not earn cash back. Intro APR does not apply to purchases.
  • If you transfer a balance, interest will be charged on your purchases unless you pay your entire balance (including balance transfers) by the due date each month.
  • There is an intro balance transfer fee of 3% of each transfer (minimum $5) completed within the first 4 months of account opening. After that, your fee will be 5% of each transfer (minimum $5).
  • The standard variable APR for Citi Flex Plan is 14.74% - 24.74%, based on your creditworthiness. Citi Flex Plan offers are made available at Citi's discretion.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
0% Intro APR Period 18 months on Balance Transfers
14.74% - 24.74% (Variable)
$0
Excellent, Good

Additional Disclosure: Citi is a CardRates advertiser.

CASH BACK RATING

★★★★★
4.8

OVERALL RATING

4.8/5.0
  • One-time $200 cash bonus after you spend $500 on purchases within 3 months from account opening
  • Earn unlimited 1.5% cash back on every purchase, every day
  • $0 annual fee and no foreign transaction fees
  • Earn unlimited 5% cash back on hotels and rental cars booked through Capital One Travel, where you'll get Capital One's best prices on thousands of trip options. Terms apply
  • No rotating categories or sign-ups needed to earn cash rewards; plus, cash back won't expire for the life of the account and there's no limit to how much you can earn
  • 0% intro APR on purchases and balance transfers for 15 months; 15.24%-25.24% variable APR after that
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% for 15 months
0% for 15 months
15.24% - 25.24% (Variable)
$0
Excellent, Good

Before you choose a card to apply for, be sure to read the fine print in the credit card disclosure statement. Some cash back cards charge an annual fee or higher interest rates to make up for the money they give back. Choosing the wrong card could negate your earnings, and possibly cost you more over the long haul.

Best “Restaurant Rewards” Cards for 20- to 30-Year-Olds

According to recent research, millennials account for one-third of restaurant revenues in America. If you’re a fan of eating out, or if you’re prone to grabbing a quick bite after a long day at the office, then you may want to consider a good restaurant rewards card — like those listed below.

These cards often provide increased cash back or other rewards when you use the card to pay your restaurant bill. And the rewards can quickly add up if you eat out a lot. Some cards even offer rewards at bars, food delivery services, or other non-traditional establishments that serve food.

EXPERT'S RATING

★★★★★
4.7

OVERALL RATING

  • Earn 50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $750 toward travel when you redeem through Chase Ultimate Rewards®
  • $300 Annual Travel Credit as reimbursement for travel purchases charged to your card each account anniversary year.
  • Earn 5x total points on air travel and 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards® immediately after the first $300 is spent on travel purchases annually. Earn 3x points on other travel and dining & 1 point per $1 spent on all other purchases
  • Get 50% more value when you redeem your points for travel through Chase Ultimate Rewards®. For example, 50,000 points are worth $750 toward travel
  • With Pay Yourself Back℠, your points are worth 50% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories
  • 1:1 point transfer to leading airline and hotel loyalty programs
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
17.24% - 24.24% Variable
$550
Good/Excellent

8. Capital One® Savor® Cash Rewards Credit Card

This card is currently not available.

Capital One® Rating

★★★★★
N/A

OVERALL RATING

N/A
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
N/A
N/A
N/A

EXPERT'S RATING

★★★★★
4.8

OVERALL RATING

  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 when you redeem through Chase Ultimate Rewards®.
  • Enjoy benefits such as a $50 annual Ultimate Rewards Hotel Credit, 5x on travel purchased through Chase Ultimate Rewards®, 3x on dining and 2x on all other travel purchases, plus more.
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,000 toward travel.
  • With Pay Yourself Back℠, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
16.24% - 23.24% Variable
$95
Good/Excellent

Make sure any card you apply for matches your eating-out habits. Some cards limit their definition of restaurants to dine-in establishments only — meaning that fast food won’t count. Others disqualify businesses that make a majority of their revenue from alcohol, which would rule out many popular bars.

Best “Travel” Cards for 20- to 30-Year-Olds

Adults between the ages of 18 and 34 spend more money on travel each year than any other age group in America. Wouldn’t it be nice to get some of that money back and still experience the thrills of seeing the world?

With a good travel rewards card, like those listed below, you can get travel discounts, cash back, premium upgrades, or outright free accommodations with airlines, hotels, and transportation options around the globe.

And what’s even better, you can use your every-day purchases to build up the rewards that will help pay for your next adventure.

AIR MILES RATING

★★★★★
4.9

OVERALL RATING

4.8/5.0
  • Enjoy a one-time bonus of 75,000 miles once you spend $4,000 on purchases within 3 months from account opening, equal to $750 in travel
  • Earn unlimited 2X miles on every purchase, every day
  • Miles won't expire for the life of the account and there's no limit to how many you can earn
  • Receive up to a $100 credit for Global Entry or TSA PreCheck®
  • Earn 5X miles on hotels and rental cars booked through Capital One Travel, where you'll get Capital One's best prices on thousands of trip options
  • Use your miles to get reimbursed for any travel purchase—or redeem by booking a trip through Capital One Travel
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
16.24% - 24.24% (Variable)
$95
Excellent, Good
Discover it® Miles Review

at Discover Card'ssecure website

AIR MILES RATING

★★★★★
4.9

OVERALL RATING

  • UNLIMITED BONUS: Only Discover gives you an unlimited match of all the Miles you’ve earned at the end of your first year. For example, if you earn 35,000 Miles, you get 70,000 Miles.  There’s no signing up, no minimum spending or maximum rewards. Just a Miles-for-Miles match.
  • Automatically earn unlimited 1.5x Miles on every dollar of every purchase - with no annual fee.
  • Redeem Miles to pay any part of your monthly bill, including your minimum payment.
  • Turn Miles into cash in any amount, any time. Or redeem as a statement credit for travel purchases like airfare, hotels, rideshares, gas stations, restaurants and more with no blackout dates. However you redeem, Miles keep the same value. And Miles never expire.
  • New Intro APR: 0% intro APR† for 15 months on purchases. Then 12.24% to 23.24% Standard Variable Purchase APR will apply.
  • Discover is accepted nationwide by 99% of the places that take credit cards.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% Intro APR for 15 months
0% Intro APR for 15 months
12.24% - 23.24% Variable APR
$0
Excellent/Good

AIR MILES RATING

★★★★★
4.9

OVERALL RATING

4.8/5.0
  • $0 annual fee and no foreign transaction fees
  • Earn a bonus of 20,000 miles once you spend $500 on purchases within 3 months from account opening, equal to $200 in travel
  • Earn unlimited 1.25X miles on every purchase, every day
  • Miles won't expire for the life of the account and there's no limit to how many you can earn
  • Earn 5X miles on hotels and rental cars booked through Capital One Travel, where you'll get Capital One's best prices on thousands of trip options
  • Use your miles to get reimbursed for any travel purchase—or redeem by booking a trip through Capital One Travel
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% for 15 months
0% for 15 months
15.24% - 25.24% (Variable)
$0
Excellent, Good

Whether you’re circling the globe or just heading out of town for the weekend, a travel rewards card can be your ticket to a cheaper outing — which in turn can help extend your trip or shore up rewards for the next one. What’s not to like?

Best “Low Interest” Cards for 20- to 30-Year-Olds

Rewards are great, but they often come with a price. After all, the credit card issuers have to find some way to make up the value of the rewards they extend.

Most often, they make up for those losses with annual fees and interest rates. While a 5% cash back card may seem awesome on the surface, it loses its luster if you’re paying 25% interest on a large balance.

That’s why many money-savvy millennials turn to low-interest cards to fund their lifestyle. While these cards may not feature the same headline-grabbing rewards as their peers, they act as a sensible way to borrow money without paying dearly for the privilege.

Discover it® Cash Back Review

at Discover Card'ssecure website

LOW APR RATING

★★★★★
4.8

OVERALL RATING

  • INTRO OFFER: Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. You could turn $150 cash back into $300.
  • Earn 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases - automatically.
  • Redeem cash back in any amount, any time. Rewards never expire.
  • NEW Intro APR: Get a 0% intro APR‡ for 15 months on purchases. Then 12.24% to 23.24% Standard Variable Purchase APR applies, based on credit worthiness.
  • No annual fee.
  • Click "APPLY NOW" to see rewards, FICO® Credit Score terms, Cashback Match™ details & other information.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% Intro APR for 15 months
0% Intro APR for 15 months
12.24% - 23.24% Variable APR
$0
Excellent/Good/Average
Discover it® Balance Transfer Review

at Discover Card'ssecure website

LOW APR RATING

★★★★★
4.8

OVERALL RATING

  • INTRO OFFER: Unlimited Cashback Match – only from Discover. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. You could turn $150 cash back into $300.
  • Earn 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases – automatically.
  • Redeem cash back any amount, any time. Rewards never expire.
  • No annual fee.
  • Get your free Credit Scorecard with your FICO® Credit Score, number of recent inquiries and more.
  • Click "APPLY NOW" to see rewards, FICO® Credit Score terms, Cashback Match™ details & other information.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% Intro APR for 6 months
0% Intro APR for 18 months
12.24% - 23.24% Variable APR
$0
Excellent/Good/Average

LOW APR RATING

★★★★★
4.8

OVERALL RATING

  • Start off strong with 0% Intro APR for 18 months from account opening on purchases and balance transfers. A variable APR of 15.24% - 23.99% on balance transfers and purchases after the introductory period ends.
  • Lower your interest rate by 2% each year. Automatically be considered for an APR reduction when you pay on time, and spend at least $1000 on your card by your next account anniversary.
  • Raise your credit limit. Get an automatic, one-time review for a higher credit limit when you pay on time, and spend $500 in your first six months.
  • All for no annual fee - You won't have to pay an annual fee for all the great features that come with your Slate Edge℠ card
  • Keep tabs on your credit health - Chase Credit Journey helps you monitor your credit with free access to your latest score, real-time alerts, and more
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
0% Intro APR on Purchases 18 months
0% Intro APR on Balance Transfers 18 months
15.24% - 23.99% Variable
$0
Good/Excellent

In the world of credit cards, nothing says ‘conservative’ like a low interest rate. Card issuers don’t extend as many low-rate cards as rewards cards — there simply isn’t as much profit in them.

That’s why you should research available cards and consider one of the above offerings when adding a new piece of plastic to your wallet.

Best “Bad Credit” Cards for 20- to 30-Year-Olds

Mistakes happen. And, in some ways, it’s better to get your errors out of the way early instead of saving them for later in life.

Thankfully, turning the page and moving on from the past can start with a credit card that’s designed to help you rebuild your credit. Several issuers offer this type of card, and many have very forgiving acceptance standards that make acquiring second-chance credit easier than it’s ever been.

Check out our top-rated selections below to see what you may qualify for.

PREMIER Bankcard® Mastercard® Credit Card Review

at PREMIER Bankcard®'ssecure website

BAD CREDIT RATING

★★★★★
4.7

OVERALL RATING

  • Don’t let a low FICO score stop you from applying – we approve applications others may not.
  • You don’t need good credit to apply.
  • Just complete the short application and find out in 60 seconds if you’re approved.
  • When you need assistance our award-winning US-based Customer Service agents are there to help.
  • FICO scores are used to represent the creditworthiness of a person and may be one indicator to the credit type you are eligible for. However, credit score alone does not guarantee or imply approval for any PREMIER Bankcard® product.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
See Issuer Website
See Issuer Website
Fair/Poor
PREMIER Bankcard® Grey Credit Card Review

at PREMIER Bankcard®'ssecure website

BAD CREDIT RATING

★★★★★
4.7

OVERALL RATING

  • You don’t need good credit to apply.
  • We help people with bad credit, every day.
  • Just complete the short application and find out in 60 seconds if you’re approved.
  • You can build* or rebuild your credit: apply for a PREMIER Bankcard credit card, keep your balance low, and pay all your monthly bills on time.
  • Don’t let a low FICO score stop you from applying – we approve applications others may not.
  • FICO scores are used to represent the creditworthiness of a person and may be one indicator to the credit type you are eligible for. However, credit score alone does not guarantee or imply approval for any PREMIER Bankcard® product.
  • *Build credit by keeping your balance low and paying all your bills on time every month.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
See Issuer Website
See Issuer Website
Fair/Poor
Surge Mastercard® Review

at Celtic Bank'ssecure website

BAD CREDIT RATING

★★★★★
4.6

OVERALL RATING

  • Up to $1,000 credit limit doubles up to $2,000! (Simply make your first 6 monthly minimum payments on time)
  • All credit types welcome to apply!
  • Free access to your Vantage 3.0 score From Experian* (When you sign up for e-statements)
  • Initial Credit Limit of $300 – $1,000* (subject to available credit)
  • Monthly reporting to the three major credit bureaus
  • See if you’re Pre-Qualified without impacting your credit score
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
See website for Details
See website for Details
24.99% – 29.99% (Variable)
See website for Details
See website for Details*

Remember that credit is never free and can get quite expensive if you have a damaged credit history. Study the terms and conditions of any card that interests you so you know the fees associated with each before making a decision.

Some cards that are designed for consumers who have bad credit can charge setup and annual fees, as well as high interest rates and other charges. But with responsible usage, you can improve your score enough to graduate to a less expensive credit card.

What is a Good First Credit Card?

The key to finding a good first credit card is to pick an issuer you can grow with. This is where credit card newcomers can quickly become confused.

There’s a difference between your credit card issuer and your credit card network. Most of us have seen the Visa, Mastercard, and American Express logos. These are credit card networks — and they process card transactions for issuing banks.

Issuers are Capital One, Bank of America, Chase, Citibank, etc. Those are the issuing banks that are lending you the money on your credit card. They pay a fee to the network to process your transactions.

In some cases, a bank can also run its own network — think American Express and Discover.

When you choose your first credit card, keep your issuing bank in mind. Many larger banks offer cards for several types of consumers.

That means you can start with an entry-level card as your first piece of plastic. But, as your credit rating improves, you can graduate to better cards with higher limits without having to submit new applications and take on unnecessary hard inquiries.

Capital One, for example, offers cards for consumers with new or bad credit all the way up to excellent credit, and provides a bridge to get from one end of the credit score spectrum to the other.

Most issuers regularly check on entry-level cardholders to see if their credit score warrants a card upgrade. Capital One does this every six months. If you’ve improved your score enough, Capital One will automatically boost your credit limit or give you an outright upgrade to a better card — at no additional cost.

Credit cards aren’t always about the rewards, perks, or fancy designs. Quite often, issuers make cards flashy to hide their flaws. By choosing a reliable issuing bank with a wide range of cards, you’ll rarely have to worry about problems with your account or a lack of room to grow.

What Credit Score Do You Start With?

Many people assume that consumers start with a credit score of zero and work their way up. Not only is this untrue, but it’s also impossible.

The lowest possible FICO credit score is 300, but that’s reserved for consumers who have a substantial number of financial mistakes and bankruptcies on their file. It wouldn’t be fair to start someone off with such a bad credit score.

Instead, credit newcomers start off with no score at all. The industry refers to these people as credit invisible. While that may sound like a bad thing, it really isn’t. When you’re credit invisible, it simply means you don’t have enough credit history on file to generate a reliable score.

While some credit card issuers may avoid you since they can’t properly gauge your risk level, being credit invisible isn’t as bad as having bad credit.

Several credit cards are designed for credit newcomers, with the goal of helping you establish a pattern of positive payments that help you generate a score. Quite often, that initial score starts somewhere between the lowest score (300) and the highest (850).

FICO Score® Ranges

Your credit history doesn’t have to start with a traditional credit card. You can establish a credit history with a loan – personal, auto, student, etc. — or by paying certain bills that report payment history to the three main credit reporting bureaus.

But whichever route you take, be certain to always make on-time payments. Just as a good payment history can improve your score, paying a single bill more than 30 days late can instantly knock as many as 100 points off your score.

That could leave your first credit score a lot closer to 300 than to 850. And that late payment will stick around on your credit report for as long as seven years.

How Many Credit Cards Should One Person Have?

Credit cards are a form of debt — and the rule of thumb with debt is to never take on more than you can handle. That means only applying for credit you’re certain you can pay off without overwhelming your finances.

For some people, that could mean having five or six credit cards. For others, that may mean having none. A key reason why many people add multiple cards to their wallets is to increase their available credit and decrease their utilization — both of which can improve your credit score.

About 30% of your overall credit score relies upon your available credit and how much of your overall credit limit you are currently using. You calculate your utilization by dividing your current credit card balance(s) by your overall credit limit. For example, a credit card with a $1,000 limit and a $250 balance has a utilization of 25%.

Lenders like to see a low utilization because it shows that you’re responsible with your current available credit. When you add another credit card, you’re increasing your overall available credit — hence lowering your utilization.

If this person adds a second credit card with another $1,000 credit limit, he or she now has $2,000 in overall available credit and only that $250 balance. This instantly lowers the utilization ratio from 25% to a much more attractive 12.5%.

Chart of Example Utilization Rate

Divide your current credit card balances by your overall credit limits to calculate your utilization rate.

That doesn’t mean you should add several credit cards just to lower your utilization. Every credit card you apply for also includes a hard inquiry on your credit report. Obtaining more than two or three of these inquiries in a two-year period starts to lower your credit score with every new application.

In short, slow and steady wins the race. Rushing to add several credit cards only increases your temptation to spend. Instead, decide what you can afford, given your current financial situation, and find a card (or cards) that work for you.

Choose a Card that Fits Your Lifestyle

Whether you’re looking to travel, save money, or earn cash back, there are dozens of top credit cards for 20- to 30-year-olds that can help you reach your goals without blowing your budget. The key is to find the card that fits your financial situation, but still provides enough room to grow with you as you advance in your life and career.

After all, millennials won’t always be the new kids on the block. One day, we’ll be the older generation that’s cracking jokes about the younger kids. Making the right financial decisions now will ensure you won’t be tomorrow’s punchline.

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