Which Credit Card Should You Use to Build Credit?

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Before you can get the best credit cards, you need to build credit. If possible, the best credit card is one that earns rewards you can use. With so many rewards cards to choose from, the decision can be harder than you realize.

Whether you want to earn cash rewards or the best credit card for travel miles, these two cards can build your credit score. Plus, you earn rewards at the same time.

Always Pay Your Balance to Build Credit

Let’s cover the main rule of owning credit cards.

You must pay your credit card balance in full each month to boost your score. Missed payments remain on your credit report for up to seven years. Also, each missed payment reduces your credit score and your approval odds can be at risk for future credit applications.

The Best Credit Cards to Build Credit

If you just want to start building credit, try getting an unsecured rewards credit card. You won’t pay an annual fee and you earn rewards points on every purchase.

Also, when you’re ready to apply for a different credit card, you can keep this first card for free.

Your credit card is made up of several factors. On-time payments are a driving factor, but the age of your credit accounts is important too.

At first, you will want to keep your card as a secondary card. It will still help your credit score grow, even if you only use it for one purchase a year. It’s also a free way to build credit because you don’t pay an annual fee.

The average American credit score is around 695. If you’re a few points below, you have good approval odds with these recommendations.

Option 1: Chase Freedom

The Chase Freedom offers tiered purchase rewards. Each quarter, there’s are revolving 5% bonus categories on the first $1,500 in combined spending. After that, you earn 1% on all purchases. Plus, you always earn unlimited 1% on all non-bonus categories.

Some of the bonus categories include:

  • Gas Stations
  • Grocery Stores
  • Digital Wallet Payments

You can redeem your rewards for cash back, award travel, and gift cards.

More importantly, you earn Chase Ultimate Rewards points, some of the most valuable credit card rewards points. You can also pool them with your other Ultimate Rewards credit cards.

One of these cards is the Chase Sapphire Preferred. With the Sapphire Preferred, your points are worth 25% more for award travel. You can transfer them directly to airlines and hotel loyalty accounts.

But, you may need a credit score of 740 to qualify for the Chase Sapphire Preferred®.

Since the Freedom is an easy way to earn bonus points on non-travel awards, you can continue to use it on a regular basis. Then, you can redeem the points for award travel with the Sapphire Preferred.

FYI: here’s a comparison post on the Chase Sapphire Preferred vs Capital One Venture

Option 2: Wells Fargo Propel

The Wells Fargo Propel is in the lifestyle rewards credit cards categories. You earn bonus points on many common purchases and you have some valuable redemption options too.

If you only want one credit card, it can easily be the Wells Fargo Propel American Express® Card.

You earn unlimited 3 points per $1 on these purchases:

  • Restaurants
  • Gas
  • Transit and Rideshares
  • Travel
  • Popular Streaming Services

All other purchases earn 1 point per $1 spent.

Your redemption options include travel, cash, and gift card rewards. Although your points are worth 1 cent each for cash and gift cards, they can be worth 1.5 cents each for travel.

Also, you get free cell phone protection up to $600 per claim.

Finally, you won’t pay an annual fee or foreign transaction fees with this card either.

Option 3: IHG Rewards Club Premier Credit Card

Hotel credit cards are another way easy way to build credit. When you pick one with a free anniversary night, the free night offsets the annual fee. The IHG Rewards Club Premier is one of these cards.

Each card anniversary, you get a free night. Since most IHG nights cost more than $100, this award is easily worth more than the $89 annual fee. Some of the places you can enjoy your free night includes Holiday Inn Express, Crowne Plaza, Candlewood Suites, and InterContinental.

If you sit through long security lines when you fly, IHG offers free Global Entry or TSA Precheck.

To redeem your points, free nights start at 5,000 points. An exclusive IHG® Rewards Club Premier Credit Card benefit is getting the fourth night free when you pay for your first three nights with points.

Option 4: Blue Delta SkyMiles Credit Card

It used to be that airline credit cards were not great for things other than a flight. That’s no longer the case. If you fly Delta, consider the Blue Delta SkyMiles Credit Card.

You earn 2 points per $1 on all Delta purchases and U.S. restaurants. All other purchases earn 1 point per $1. Plus, you get 20% savings on in-flight purchases.

When you want a basic credit card that earns points and builds credit without an annual fee, this is a solid choice. But, you will need to apply for the Gold Delta SkyMiles Credit Card if you want free checked bags and priority boarding.

With either of these Delta credit cards, you only need a credit score in the mid-600s.

What If You Don’t Have Good Credit?

If you don’t have a credit score in the 600s, you still have options to build credit. It’s still possible to get a rewards credit card. But, it may have to be a secured credit card. You won’t have a high credit limit, but you might qualify for an unsecured rewards card in one year.

If you’re rebuilding credit, go with the Discover It Secured.

You won’t pay an annual fee (uncommon for secured cards) and you earn 2% back at restaurants and gas stations. This 2% bonus applies to the first $1,000 in quarterly purchases. All other purchases earn 1% back.

Your credit limit is the same amount as your refundable security deposit. So, if you pay a $1,000 security deposit, your credit limit is $1,000.

Finally, Discover matches your cash back dollar for dollar at the end of your first year. This is another valuable bonus offer that you won’t see with other secured credit cards.

Summary

Any credit card you make on-time payments with will build credit. But, going with a rewards card that doesn’t charge an annual fee lets you do it for free. Plus, you “get paid” to build credit at the same time.

Mary Renking

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Which Credit Card Should You Use to Build Credit?
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About the Author

Mary Renking
Mary writes about how to book travel with award miles & points, reviews top travel credit cards, and basic rewards news.

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