Find the top seven beginner credit cards for 2023, including options with sign-up bonuses, high cash back, and valuable benefits like no foreign transaction fees.
As we head into 2023, there are so many different credit cards to choose from, making it almost impossible to know which one is best for you, especially if you’re a beginner.
First off, if you're just starting out on your credit journey, it's important to follow some best practices when it comes to credit cards. Make sure to pay your bills on time and in full every month. These two actions alone will cover 65% of your credit score.
When considering a good beginner credit card, there are three things to keep in mind: no annual fee, cash back earning that's greater than 1%, and a sign-up bonus.
Today, we'll be discussing these features for each of the top seven credit cards for beginners. We'll start with the sign-up bonus, then move on to earnings potential and benefits. Since all of these cards are recommended for beginners, they all have no annual fee.
The Capital One Quicksilver is our top pick for the best beginner credit card in 2023.
In the first year, you'll get 3% cash back on everything, including gas, groceries, and online shopping. Additionally, if you book hotels or car rentals through the Capital One travel portal, you'll get 5% cash back. The Quicksilver also has a promotional APR of 0% for the first 15 months.
APR or Annual percentage rate refers to the yearly interest rate you'll pay if you carry a balance on your credit card. Some credit cards have variable APRs, meaning your rate can go up or down over time, according to Citizens Bank.
One of the major benefits of this card is that it has no foreign transaction fees, making it a great choice for travelers.
One of the main reasons the Capital One Quicksilver is our top pick for beginner credit cards is that it is generally easier to get approved for than some other cards, especially if you have a limited credit history. This card can be a great stepping stone to building your credit and eventually getting approved for more premium cards with even more valuable rewards and benefits. It's important to remember that credit card ownership is a journey. The Quicksilver can be a great starting point on your way to bigger and better things.
The Discover It is a credit card that has been popular for many years, with a strong rewards program and valuable benefits. It offers a signup bonus of doubling your cash back in the first year, as well as zero percent APR for the first 15 months.
The Discover It earns 5% cash back on rotating categories, similar to the Chase Freedom Flex (more on this card below). For example, in the first quarter of 2022, the categories included grocery stores and fitness clubs, while quarter two included gas stations and Target, quarter three included restaurants and PayPal, and quarter four included Amazon.com and digital wallets.
One of the major benefits of the Discover It card is that it has no foreign transaction fees, making it a great option for those who travel abroad.
Overall, the Discover It is a reliable and user-friendly credit card, especially for beginners. It may be easier to get approved for than some other cards, and it provides helpful educational resources for those new to using credit cards. That's why it comes in at number two on our list of beginner credit cards.
The Chase Freedom Flex is a credit card that comes with a $200 signup bonus and zero percent APR for the first 15 months.
It offers a generous rewards program, earning 5% cash back on categories that change every quarter. For example, in the first quarter of 2022, the categories included grocery stores and eBay, while quarter two included Amazon and streaming services. In quarter three, the categories were gas stations, car rentals, movie theaters, and live entertainment, and quarter four included Walmart and PayPal.
In addition to these rotating categories, the Freedom Flex also offers 5% cash back on travel booked through the Chase Ultimate Rewards portal, 3% cashback on dining and drugstore purchases, and 1% cash back on all other purchases.
One of the major benefits of this card is that it is part of the Chase ecosystem, which means that the cash back rewards can be converted into Ultimate Rewards points and transferred to travel or hotel partners. The Freedom Flex also offers cell phone protection of up to $800 with a $50 deductible, and 5% cash back on all Lyft rides until March 2025.
Overall, the Chase Freedom Flex is a strong choice for those who want a credit card with a flexible rewards program and valuable benefits. However, it may be slightly harder to get approved for than some other cards, so it may be more suitable for those who have already established a good credit score.
A ‘good credit score’ usually depends on the lender. FICO credit score is a type of credit score that is widely used by lenders to assess a borrower's creditworthiness. A good FICO credit score generally falls in the range of 670 to 739. Scores in this range are considered "good" and may get you approved for credit cards, auto loans, and other types of financing with a lower interest rate. Scores above 740 are considered "excellent" and may get you the best interest rates on loans and credit cards.It's important to note that the specific credit score range that is considered "good" can vary depending on the lender and the type of credit you are seeking. Some lenders may consider scores in the 650 to 699 range to be good, while others may require a score of 750 or higher. It's always a good idea to check with the lender to see what their specific credit score requirements are.
The Citi Custom Cash Credit Card is a solid choice for beginners, particularly for those who frequently spend money on gas and groceries.
The card comes with a sign-up bonus of $200 after spending $1,500 within the first six months, as well as a 0% APR for the first 15 months. It's important to remember that while the promotional APR can be useful in certain circumstances, it's always best to pay off your balances in full and on time in order to avoid incurring interest charges and damaging your credit score.
One of the standout features of the Citi Custom Cash Card is its rewards structure, which allows cardholders to earn 5% cash back on their highest spending category every month. The categories available for the 5% cash back rate include gas, groceries, and several others. It's important to note that the 5% cash back rate is only applicable on the first $500 of spend per month in these categories, with all other purchases earning 1% cash back. Additionally, cardholders will earn 1% cash back after spending $500 or more in any of the eligible categories.
Another key feature of the City Custom Cash Card is its ability to pair with the Citi Premier Credit Card. By transferring Citi ThankYou points earned on the Custom Cash Card to the Premier Card, cardholders can then transfer their points to participating airlines and hotels.
This can be a valuable benefit for those who frequently travel and want to maximize their rewards.
Overall, the Citi Custom Cash Credit Card is a solid choice for beginners, particularly for those who spend a significant amount on gas and groceries. By focusing spending on one of these categories and using the card exclusively in that category, cardholders can maximize their rewards earnings and take advantage of the sign-up bonus.
Follow us on LinkedIn and Twitter!
The Amazon Prime Rewards card is a great credit card for those who shop with Amazon on a regular basis.
One of the main benefits of this card is that it has a relatively low requirement for signing up, with a credit score requirement of 640 or higher. This means that as long as you have some prior credit history, you have a good chance of being accepted for the card.
Amazon also offers an instant decision on your application, with a response in just 15 seconds. The Amazon Prime Rewards card offers a signup bonus of a $150 Amazon gift card for those who have an Amazon Prime membership.
With this card, you'll also get unlimited 5% cash back on all Amazon and Whole Foods purchases, 2% cash back at restaurants, gas stations, and drugstores, and 1% cash back on all other purchases. In addition to these rewards, the card also has no foreign transaction fees and offers various perks such as travel protection, rental car insurance, and 10% off select items.
If you're an Amazon Prime customer and you shop on Amazon more than once a month, the 5% cash back offered by the Amazon Prime Rewards card is likely to be well worth it. This cash back essentially pays for your entire Amazon Prime membership if you spend more than $2,300 per year on Amazon, making the card essentially free.
The Bank of America Customized Cash Rewards Card is a good selection for those looking for a catch-all credit card.
One of the standout features of this card is the sign-up bonus of $200 after spending $1,000 in the first 90 days. Additionally, cardholders can take advantage of a 0% promotional APR for the first 18 billing cycles. It's important to note that while there is no interest on the card during this period, it's still important to pay off any balances in full in order to avoid negatively impacting your credit utilization ratio, and to not be surprised when the promo period ends and you start getting charged interest.
Earning rewards on this card is also very straightforward. Cardholders will earn 3% cash back on their choice of select categories, including gas and online shopping. The online shopping category is particularly noteworthy, as it can serve as a worthy alternative to the Apple Card, which only offers 3% cash back on purchases made through Apple.com. In addition to the 3% cash back rate, this card also offers 2% cash back on grocery and wholesale club purchases, and 1% cash back on all other purchases.
Another key benefit of the Bank of America Customized Cash Rewards Card is its participation in the Bank of America Preferred Rewards program. Customers with significant deposits at Bank of America can earn extra cash back on their purchases, with bonuses ranging from 25% to 75% depending on the amount on deposit. With no annual fee, this card is a solid choice for anyone looking to maximize their rewards earnings.
The Bilt MasterCard is a new credit card that has been making waves in the industry. While it does not offer a sign-up bonus, it does have some unique features that make it stand out from the competition.
One of these is the ability to earn points for rent payments, which can add up to thousands of points per month if you pay a high rent. The Bilt MasterCard also offers double points on dining, travel, and other purchases on the first of every month, except for rent.
In addition, the points earned on this card can be transferred to a number of airline and hotel partners, including American Airlines, United Airlines, and Hyatt.
The Bilt MasterCard is geared towards younger consumers who may have a limited credit history and may be approved for a lower credit limit. However, the card offers a feature called Bilt Protect, which allows users to split their monthly rent payments into smaller increments and pay them off over the course of the month, helping to avoid high balances and protect their credit scores.
Overall, the Bilt MasterCard is a solid choice for those looking to earn rewards on their everyday purchases, particularly if they pay a high rent and want to take advantage of the unique points earning opportunities offered by the card.
Zack is a journalism student at Quinnipiac University. In addition to writing for Retirement Daily, he also covers Quinnipiac Athletics and the Boston Celtics as well as owning a marketing company, Hochberg Marketing.
Zack Hochberg is an assistant editor at Retirement Daily.