First Credit Card for Non-student

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills.
Post Reply
Topic Author
Doctor Rhythm
Posts: 3061
Joined: Mon Jan 22, 2018 2:55 am

First Credit Card for Non-student

Post by Doctor Rhythm »

Looking for advice and opinions on a first credit card for a working, non-student young adult without a credit history. I’ve looked over the articles from NerdWallet and Forbes and some prior threads here. General thoughts and preference:

1. Secured card is fine, no problem with a high minimum deposit.

2. Interest rate is irrelevant.

3. Many recommend Discover, but I’m concerned about its limited acceptance. I rarely use mine for that reason, but maybe its footprint has enlarged in the last decade?

4. Goal to build credit and stop using a debit card.

5. I’m sort of favoring one of CapitalOne’s offerings, but also interested in some of the newcomers like Petal.

Also, any thoughts on advantages and disadvantages of just adding them as a user to parents’ card account — does this build credit in the same way as having their own card?
mhalley
Posts: 10432
Joined: Tue Nov 20, 2007 5:02 am

Re: First Credit Card for Non-student

Post by mhalley »

Depending on the card, adding them to your card can help their credit score. Look into a local credit union for a fresh start program. I have heard petal is a good starter card, but no personal exp.
https://wallethub.com/d/petal-cash-back-card-3249c
Discover has a lot wider acceptance now, with 10.6 million merchants vs 10.9 for visa. Those numbers are from 2018.
https://www.valuepenguin.com/where-visa ... r-accepted
Last edited by mhalley on Tue Feb 28, 2023 3:15 pm, edited 1 time in total.
User avatar
Vulcan
Posts: 2996
Joined: Sat Apr 05, 2014 11:43 pm

Re: First Credit Card for Non-student

Post by Vulcan »

Yes, add them to a few of your oldest credit cards, and next month they will have an 800+ credit score, and will be able to get any card of their own.

You don't even have to give them the actual cards, just wait a month for their credit reports to get updated.

I didn't create these rules, I just play by them ¯\_(ツ)_/¯
If you torture the data long enough, it will confess to anything. ~Ronald Coase
User avatar
Beensabu
Posts: 5657
Joined: Sun Aug 14, 2016 3:22 pm

Re: First Credit Card for Non-student

Post by Beensabu »

Does the young adult have a bank account?

Why don't they apply for a card with the financial institution that they already bank with?
"The only thing that makes life possible is permanent, intolerable uncertainty; not knowing what comes next." ~Ursula LeGuin
LittleMaggieMae
Posts: 2569
Joined: Mon Aug 12, 2019 9:06 pm

Re: First Credit Card for Non-student

Post by LittleMaggieMae »

3. Many recommend Discover, but I’m concerned about its limited acceptance. I rarely use mine for that reason, but maybe its footprint has enlarged in the last decade?
I think my Discover card is my oldest account at this point (like decades). I live in a large densely populated urban area and I've never had a problem using my Discover Card. Even Aldi takes Discover (used for the 5% cash back at grocery stores quarterly promotion). It's never been turned away at a gas station (used for 5% cash back) or restaurants (or Amazon, Etsy, assorted pet related Big Box stores, Big box home stores, etc...) I don't charge much - so I tend to try to use whatever card is giving me the best cash back at the time.

I don't travel - but I think I may have used it for a hotel room in the distant past.

The only time Discover has been an issue for me is when purchasing from a small time vendor - say at an Arts and Crafts Faire or food vendor at a Street Music Festival or at a small Mom and Pop restaurant. I think they prefer Visa/Master Card. But, using Venmo can overcome this if you only have a Discover card.

That said - why not see what kind of CC offers are available at the bank your kid uses (the one where they are having their paycheck direct deposited)?

Let your kid do the foot work/research. And then go over their findings with them. I've discovered that a lot of the under 30 year olds find banks/banking to be rather "mysterious" and "magical" and maybe even "dangerous" - especially if their parents have drilled it into their heads that CCs are evil and Debt is evil and then left it at that (no actual reasons for why they are 'evil" other than "your life will be ruined"). Not saying you did this. But your kid may have friends who have this narrative in their head. :(
SpaghettiLegs
Posts: 175
Joined: Wed Dec 07, 2022 8:20 pm

Re: First Credit Card for Non-student

Post by SpaghettiLegs »

When my kid was in college (just a couple years ago) he tried to get his own credit card through our bank and couldn’t because of lack of credit history. It was very easy to get him his own card under my account and now he has his own. It was kind of nice as I could see how he was spending.
User avatar
ResearchMed
Posts: 16795
Joined: Fri Dec 26, 2008 10:25 pm

Re: First Credit Card for Non-student

Post by ResearchMed »

Do any cards still allow an authorized user with a lower limit than the primary cardholder?
Then it could really be used "as if it's their own" from the start.

RM
This signature is a placebo. You are in the control group.
Topic Author
Doctor Rhythm
Posts: 3061
Joined: Mon Jan 22, 2018 2:55 am

Re: First Credit Card for Non-student

Post by Doctor Rhythm »

Appreciate all the input.

Will plan to add to an existing parental card account and additionally try to get a separate card. Will re-consider option of going with Discover based on opinions here. To address a question/option raised by some, the existing bank doesn't offer a suitable 'starter' card - otherwise I'd probably go for it, as a way to keep everything visible within a single app.
Angel
Posts: 74
Joined: Fri Apr 27, 2007 10:44 pm

Re: First Credit Card for Non-student

Post by Angel »

If you have an AMEX card, you can add an authorized user and specify the credit limit you want for them.
User avatar
enad
Posts: 1581
Joined: Fri Aug 12, 2022 2:50 pm

Re: First Credit Card for Non-student

Post by enad »

Discover or Chase Amazon Visa are two good cards.
What Goes Up Must come down -- David Clayton-Thomas (1968), BST
OnTrack2020
Posts: 1423
Joined: Mon Mar 20, 2017 10:24 am

Re: First Credit Card for Non-student

Post by OnTrack2020 »

We had our son (20+, non-student), after reading recommendations on this board a while back, apply for a Discover It card as his first credit card. He applied and was denied. The reason---he didn't have any credit.

We had him try again recently with the Visa Petal card, and he was approved. It's not secured, there is no deposit, and the credit limit was a very reasonable amount, around $1k-$2k, perfect for him in starting to build credit.
chalet
Posts: 235
Joined: Wed Aug 28, 2019 9:59 pm

Re: First Credit Card for Non-student

Post by chalet »

look at local banks and credit unions that offer secured cards.

pick one with no monthly or annual fees.
User avatar
ResearchMed
Posts: 16795
Joined: Fri Dec 26, 2008 10:25 pm

Re: First Credit Card for Non-student

Post by ResearchMed »

OnTrack2020 wrote: Sat Mar 25, 2023 8:44 am We had our son (20+, non-student), after reading recommendations on this board a while back, apply for a Discover It card as his first credit card. He applied and was denied. The reason---he didn't have any credit.

We had him try again recently with the Visa Petal card, and he was approved. It's not secured, there is no deposit, and the credit limit was a very reasonable amount, around $1k-$2k, perfect for him in starting to build credit.

Not that *you* will have another chance at this "first card", but for others, it might be useful to first get the other person set us as an authorized user on a card (or maybe even two) and use them, and then let them generate a credit history. Then the first "own card" should be much easier, with a bigger choice of cards/care issuers.

And meanwhile, they'd have a card to use.

RM
This signature is a placebo. You are in the control group.
Topic Author
Doctor Rhythm
Posts: 3061
Joined: Mon Jan 22, 2018 2:55 am

Re: First Credit Card for Non-student

Post by Doctor Rhythm »

Thanks all!

Got approved for a (surprisingly) unsecured card from CapitalOne, and also added on as a user to my oldest card account from Citibank, which otherwise is seldom used.
Post Reply