The 5 BEST Credit Cards For Beginners in 2020

What's up 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 And that means a lot of the information I talked about in that video is now outdated.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.

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.

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 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.

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 Discover it Secured Card.

Now, a secured credit card just means you'll put down a refundable security deposit, and in return, 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, they'll give you back a two hundred dollar 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 trash. Like, they're the worst! So many of them charge unnecessarily high annual fees, like you have the Wells Fargo secured card at twenty-five dollars a year, or the US Bank secured card at twenty-nine dollars per year. Come on, that's just ridiculous! 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. Now, 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. In this case, your secured 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.

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, so 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 Cash Back card instead. This means you're not gonna have to put down any deposit, and with this card, there's also no annual fee. You'll get five percent cash back on places like grocery stores, restaurants, gas stations, and online shopping depending on the revolving category, plus the same one percent 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. 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 sign-up bonus, the rewards are not that spectacular, and for people who really know what they're doing, there are 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, I 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. 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 three percent cash back on Apple products, and with select merchants, you also get two percent cash back on any purchases made with Apple Pay, and then one percent 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! For those reasons, 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. This 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 card 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 that 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. Then you'll get unlimited five percent cash back on all Amazon and Whole Foods purchases, two percent cash back at restaurants, gas stations, and drugstores, and then one percent 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, three percent cash back on Amazon purchases, two percent cash back at restaurants, gas stations, and then one percent 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.

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 thinks, "Graham, you need to waste $1,000 just to get $200 back?! That doesn't make any sense!" Yes, it does! Just go and spend $1,000 as you would normally through your normal everyday spending because it pretty much guarantees 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 you 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 cash back on the category of your choice, two percent cash back at 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! 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 the 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, no worries, it's still a pretty decent credit card all the way around for the cash back and the sign-up bonus.

Finally, 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 beginners! Well, more like intermediate beginners, and that would be the American Express Blue Cash Everyday Card. 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 on the card within the first three months. And you'll get three percent cash back on certain categories, two percent cash back at grocery stores, and one percent 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.

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, español, this call may be recorded. Hi, my name is Graham Stephan. 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, because that customer service is just second to none. For that reason, I would highly recommend this card for someone who is building their credit, wants to improve their score, and build a relationship with American Express. This one covers pretty much everything.

Finally, just to tie all of this together, if you're watching this right now and still a little bit confused about 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 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.

Secondly, if you're impatient like me and you want to expedite the credit building process a little bit faster, what you should do is around the same time you apply for the Discover it Secured Card, also go and apply for 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. 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.

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, you're 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!

Fourth, from there, after 8 to 12 months of getting your first card, you should go and apply for the Amex 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 for 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 the help of smashing the like button for the YouTube algorithm.

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