The 5 BEST Credit Cards For Beginners in 2020

what's the guys it's Graham here so a little over a year ago I made a video going over the best beginner credit cards to get in 2019 but now I realized there's a bit of a problem and that is that it's not 2019 anymore it's the future it's now 2020 and that means a lot of the information I talked about in that video is now outdated some of the credit cards I mentioned previously are no longer the best for beginners and thanks to the introduction of some new credit cards well we got some new ones to add on to the list so in this video we're gonna be covering the best credit cards to get for beginners in 2020 these are gonna be the perfect cards to get when you're just starting out when you don't have a lot of credit history and you don't have a lot of money to spend but you still want to be a credit card connoisseur improve your score build your credit history and do all of that without spending any money out of pocket and doing this correctly from the very beginning is so important because opening up the right credit cards and using them strategically will help improve your score get you a better interest rate any time you borrow money or leverage your money to invest it'll save you a lot of money long term and all of this is very much free to do that's right everything in this video is entirely free wait no actually I changed my mind the cost of this video and all of its information is just a smash of the like button now you don't need to break your phone I'm not asking you to destroy your computer trying to smash the like button instead just a gentle tap and you're good to go so with that said I really appreciate it and let's begin the video so to start we got to begin with the tried and true of credit cards and honestly if you're just beginning and you're starting out on your credit card journey there's no reason not to get this card and that would be the discover it's secured card no I get it I sound like a broken record because they always recommend this card for anyone who's just starting out but I got to say this is the only credit card that has consistently been in every single one of my credit recommendation videos for beginners because it's that good and when it comes to this credit card here's why I would recommend it why you should get it and a few of its variations to figure out which would be the best for you first if you're completely brand new to the credit card game as in you don't have any credit whatsoever you've never had a credit card before or maybe you just turned 18 and want to know what to do next to be a fully functioning financially literate adult well that probably means you should go and apply to the discovery it's secured card now a secured credit card just means you'll put down a refundable security deposit and in return and they will give you back a credit line in that exact same amount for example if you put down a two hundred dollar security deposit today we'll give you back a two hundred all our credit line it's no different than having two hundred dollars of cash available to you at all times except now it's within a little piece of plastic so the reason why I recommend the Discover Card so much is that most secured credit cards out there as in the ones aimed at beginners are absolutely trashed like they're the worst so many of them charge unnecessarily high annual fees like you have the Wells Fargo security card at twenty five dollars a year or the US bank security card at twenty nine dollars per year and come on that's just ridiculous to pay building your credit should be free and Discover understands that so they don't charge you any annual fees Discover also gives you what almost every other secured credit card does not and that would be rewards no I'm not gonna lie these rewards are not like mind-blowing by any means but hey it's something and every little bit adds up especially when you're just starting out and in this case your secure card is going to be giving you two percent cashback on restaurants and gas stations and you'll get unlimited one percent cash back on everything else they're also running a promotion where they will match your cash back for the first year so it's really more like getting four percent cash back at restaurants and gas stations and then two percent cash back on everything else within that time frame and all of this comes with a credit card that pretty much anyone can apply for and get not only that but Discover allows you to monitor your FICO score for free on their platforms you could keep track of how your score is improving over time now alternatively if you've already started building your credit history but want something to add to that foundation then you have the option to go with their unsecured discover it cashback card instead this means you're not gonna have to put down any deposit and with this card there's also no annual fees you'll get five percent cashback on places like grocery stores restaurants gas stations in online shopping depending on the revolving category plus the same 1% cash back on everything else then just like the first one they will match your cash back for the first year so really no matter which one you pick either one of these will be perfect for building your credit score and then from there all you need to do is pay off your bill in full by the time it's due and that way you're never gonna have to owe any interest for any of your purchases that means doing all of this is totally free and you get money back for doing absolutely nothing other than signing up so there you go enjoy the savings next we're gonna be talking about another credit card that I never thought I would ever mention in one of these lists but admittedly it's grown on me and I gotta say it's a pretty decent card for people just starting out and that would be the Apple credit card yes I do realize that I've been heavily critical of this card in the past and for good reason there's no signup bonus the rewards are not that spectacular and for people really know what they're doing they're just better options out there depending on your spending however for people who are in the beginning stages of building up their credit to the legendary 800 score the Apple credit card could actually be a pretty decent way to get there though should clarify that the Apple credit card is not meant to be your first ever credit card they require a credit score of about 600 meaning you need some prior credit history in order to apply but assuming you meet that requirement here's why I would recommend it first there's no annual fee and this is insanely important for anyone just starting out because a large part of your credit score is made up by the length of your credit history or in other words the longer you keep your credit cards open the higher your credit score will be see what happens is that when you cancel a credit card over time it's going to fall off your credit report and that means your score will be lowered so it's really important when first starting out to build up a foundation of completely free no annual fee credit cards that you could just keep open indefinitely and that way keeping these cards open and active is not going to cost you any money so the Apple credit card is absolutely perfect for this then in addition to no annual fees they also give you cash back like 3% cash back on Apple products and with select merchants you also get 2% cashback on any purchases made with Apple pay and then 1% cash back on anything else I also really like this card for beginners because there are no hidden fees and the mobile app makes it really easy to see all of your charges track your spending and see exactly how much interest you would owe if you didn't pay off your bill in time it's basically like a personal finance tracker that's built into your credit card so it's perfect for people just starting out plus this card is made of titanium so it's kind of cool kind of so it's really for those reasons why I would recommend this card to add into the mix help increase your credit score and do all of that without costing you any money the third is another card I wanted to throw into the mix that I've never mentioned before as a beginner credit card but really with the rise of online shopping I have a feeling this is eventually going to turn into your go to card and that would be the Amazon Prime card the reason I'm putting this one on the list is because they have a fairly low credit requirement for signing up with a very good chance of getting accepted if you have a credit score above 640 which basically means if you've had any other lines of credit previously or have spent six months or more building your credit chances are you will get this one plus like the other two examples there's no annual fee which means all you need to do is get this car to keep it open for the rest of your life and that will help you boost your credit score to the moon which is basically another term for over 800 now before I go into the benefits of getting this card I want to make the distinction that there are two different types of Amazon credit cards and they look kind of similar but they're different the first one is the Amazon Prime rewards card vet requires you to have Amazon Prime to get the full benefit now with this card combined with Amazon Prime they'll give you a $100 Amazon gift card just for signing up and then you'll get unlimited 5% cash back on all amazon and Whole Foods purchases 2% cashback at restaurants gas stations and drugstores and then 1% cash back on everything else you'll also have no foreign transaction fees plus a few other perks like travel protection rental car insurance and so on the other card I'm referring to is just the normal Amazon rewards card this is what you could get if you don't pay for Amazon Prime but you still want rewards and it's so good it's just not as good for example they'll give you a $50 Amazon gift card when you sign up 3% cashback on Amazon purchases 2% cashback at restaurants gas stations and then 1% cash back on everything else now let's be real most of us pay for Amazon Prime so if that's the case there's never any sense in signing up for the non-prime card but even if you just do the occasional shopping on Amazon even the non Prime credit card is still pretty good and with no annual fee either one of these is a great card to get and keep open for a very long time and then number four we got another classic that I've always mentioned in these beginner lists because honestly it's just an all-around good card to get in fact this is actually one of my first ever credit cards that I got when I was first starting to build my own credit score and that would be the Bank of America cash rewards card now this is a credit card that I would recommend applying for after about 6 to 12 months of building your credit through other cards because this card does require you to be in good credit standing in order to apply but assuming you get approved this one has some pretty good benefits all with no annual fee now I like this one because they will give you a $200 cash back bonus when you spend $1,000 on the card within the first 90 days now anyone out there who gets triggered by me saying this and thanks gram you need to waste $1,000 just to get $200 back that doesn't make any sense yes it does just go and spend $1000 as you would normally through your normal everyday spending because it pretty much guarantee that nearly everyone watching just naturally spends at least three hundred and thirty-three dollars a month and if you don't and if somehow found a way to live off of less than three hundred and thirty three dollars a month please let me know I am desperate for that information because I will do it too I want to live on less than three hundred thirty three dollars a month you're also gonna be getting three percent cashback on the category of your choice two percent cashback you grocery stores and one percent cash back on everything else then if you're already a Bank of America preferred Rewards member you could get a cash back booster on the credit card potentially turning a three percent cash back into a 5.25 percent reward now of course the catch here to get the maximum of that benefit is to keep $100,000 in your Bank of America account which please listen to me never do that because the interest rate that they pay you at Bank of America is absolutely pathetic and you would actually end up losing money compared to what else you could get with that money elsewhere this is really only recommended if you have a Bank of America checking or savings account anyway and you keep a minimum of fifteen hundred dollars in the account at all times to avoid the twelve dollar monthly maintenance fee but as long as you just do that the cash back on this credit card is pretty good and one more thing if you really want to maximize the rewards here and you're feeling a little bit adventurous and you have a lot of self control is that they will offer you a zero percent interest rate for the first 15 months and of course I think it goes without saying here that if you don't have these self-control to properly handle your money with the 0% interest credit card then don't do that but anyway even if you don't plan to open up a Bank of America checking or savings account for the interest rate booster that no worries it's still a pretty decent credit card all the way around for the cash back and the sign up bonus it finally fits we're gonna be talking about a card I have never mentioned before here on the channel so watch out we got a new credit card for beginner well more like intermediate beginners and that would be the American Express blue cash every Descartes that's right we got an American Express card on a list of beginner credit cards so let me explain why and how this can help you build your credit score American Express is known as what's called a charge card which means it's meant to be paid off in full at the end of every month without ever carrying a balance because of that charge cards do not show a preset spending limit on your credit report meaning that if you charge money to this card during the month and that amount is reported to the credit bureaus it won't impact your utilization rate which is another word for how much credit you have available to you versus how much credit you use in really simple terms this means the more credit that you use usually the lower your score will be but with this card because it does not show a preset limit how much money you spend on it will not impact your credit score see the more you know in addition to that this is also one of the few American Express cards that doesn't have any annual fee which means it's entirely free to use plus you could earn a hundred and fifty dollars back when you spend a thousand dollars in the card within the first three months and you'll get 3% cashback on certain categories 2% cashback at grocery stores and 1% cash back on everything else not to mention you can also get a free shop runner membership which will give you complimentary two-day shipping on quite a few online stores and lastly one of the reasons why I love American Express so much is that they have the best customer service out there like anytime you need something call them up and they are always happy to help without having a long wait time to speak with someone you know what as an example let's just go and call up American Express right now yeah espanol this call may be recorded hi my name is Graham Stefon yeah I get a weird request make sure this master one oh the like button we got it okay cool thank you so much I really appreciate that now that was it come on guys that was entirely unscripted that's entirely real and that's one of the reasons I love American Express is because that customer service is just it's second to none and for that reason I would highly recommend this card for someone who is building their credit wants to improve their score build a relationship with American Express this one covers pretty much everything and lastly just to be able to tie all of this together if you're watching this right now and still a little bit confused of what to do here's what I would recommend in exact order if you want to get yourself a perfect credit score using all the cards I've just mentioned entirely for free first go and sign up for the discover it's secured card with a $200 deposit then once you get the credit card all you need to do is put a few expenses on the card every month and then just pay it off in full by the time it's due I would recommend just going and doing this process for six months a second if you're impatient like me and you want to expedite the credit building process a little bit faster what you should do is that around the same time you apply for the discovery it's secured card also go and apply to the Capital One secured card this is basically the exact same card except without any cash back bonuses so it's not as good but still by doubling up on your credit cards early on it will help improve your credit score a little bit and with this one just do the same thing put a few small expenses on the card every single month and then pay it off in full you'll want to do this for about six months the third after doing this for six months the next thing you'll want to do is apply for either the Amazon credit card or Apple credit card these are gonna be your first unsecured credit cards which means they don't require you to put down any deposit and with these cards are gonna be doing the same thing as you did the last one just put a few small expenses on the card every single month and then pay it off in full by the time it's due it's that easy then forth from there after 8 to 12 months from getting your first card you should go and apply for the MX blue cash card this is gonna be your first charge card that's not going to be showing a credit limit on your credit report doing this might help boost your score just a little bit more plus you're gonna be able to build a relationship with American Express which really has some of the best credit cards and the best travel rewards out there then after about 12 to 14 months from the time you opened up your first credit card you should have built up enough foundation to have a 750 credit score and then be able to take advantage of almost every single credit card offer out there to leverage your money if the best rates possible and get as much free stuff as you possibly can plus all of these are cards that you're meant to keep open for the rest of your life so these will now be the building blocks of your entire credit foundation all entirely for free with of course the help of smashing like button for the YouTube algorithm so what that said you guys thank you so much for watching I really appreciate it as always if you have not already subscribed make sure to destroy the subscribe button and notification bell so you should notify us you anytime I post a video also feel free to add me on Instagram I post here pretty much daily so if you want to be a part of it there feel free to add me there as on my second channel the Graham Stefan show I post there every single day I'm not posting here so if you want to see a brand new video for every single day make sure to add yourself to that and lastly if you guys want to free stocks that's right it's two free stocks that I mentioned it's free all you got to do is use the link down below in the description wiebel is going to be getting you to free stocks when you deposit $100 on the platform and one of those stocks is going to be valued up to $1400 if you want a chance to get a stock that could be worth a lot of money make sure to do that link down below in the description thank you guys so much for watching and until next time

Channel: Graham Stephan

Views: 818,300

Rating: 4.9597211 out of 5

Keywords: Credit cards, best credit cards, best beginner credit cards, beginner credit cards, american express, chase sapphire, discover it, credit cards 101, credit score, how to increase your credit score, credit score explained, how to increase your credit score fast, credit cards 2020, best credit cards 2020, credit cards to build credit, stock trading apps, best stock trading app, how to invest, investing in stocks, investing for beginners, how to invest in real estate

Id: SPxBgdHs9sY

Length: 15min 48sec (948 seconds)

Published: Mon Feb 03 2020