The Best Secured Credit Cards for Your Wallet in 2021

The top secured credit cards have been narrowed down to these three options. We evaluated 100+ cards to find the best offers for you.

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Secured credit cards are an excellent option for consumers with less-than-perfect credit to begin rebuilding their credit. They are also great for those who have a very limited or no credit history. However, remember that a secured credit card is simply a tool to build or improve your credit score so that you can, in time, qualify for an unsecured credit card with additional features and benefits.

Secured credit cards have been growing in popularity over the last few years. Even Amazon introduced its own secured credit card in June 2019. And the COVID-19 pandemic has only increased the demand from consumers.

However, remember that secured credit cards require an up-front deposit to secure the line of credit. Once you close the card, you will receive the deposit back. The advantage of a secured credit card is that the APRs and fees tend to be low since the card is secured. However, the goal should be to use the secured credit card for a limited time and move on to an unsecured credit card.

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MoneyGeek Quick Tip: Secured credit cards are great for students or people with limited credit history, but they aren't the only options. Some banks offer unsecured credit cards for bad credit or easier to obtain cards for students.

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MoneyGeek’s Take: Secured Credit Cards You Can’t Go Wrong With

The MoneyGeek team analyzed 100+ credit cards to find the best secured credit cards. We considered many factors, including deposits, fees, the potential to upgrade to an unsecured card and other benefits. We compared these factors against the average American’s annual spending habits and selected a few solid options for secured credit cards.

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TOP SECURED CREDIT CARDS
  • The Merrick Bank Double Your Line Secured Visa card is excellent for someone who wants to increase their credit line over time through responsible spending.
  • The Citi Secured Mastercard is great as it reports to all three credit bureaus, allowing you to build your credit score efficiently.
  • The Capital One Secured Mastercard is another solid secured credit card option for someone who travels internationally as it has no foreign transaction fees.
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When comparing secured credit cards, whether it be here or on other sites, it is important to look for two things:

  1. The ability to upgrade to an unsecured credit card, and
  2. The length of time it takes to be able to upgrade to an unsecured card

This can help improve your credit score even more since this will increase how long you’ve had an open line of credit (length of credit history), which is generally 15% of a person’s FICO score.

All the cards recommended in our content allow for the ability to upgrade within 6-18 months of opening an account, but we know our list is limited, so we recommend using the helpful comparison tables at CardRatings.com to find the right secured card for you.

Best Secured Credit Card as of October 2021

Secured credit cards may all have the same purpose, but they are not all the same. Some card issuers charge fees like an application or annual maintenance fee, while others offer excellent rewards for your spending.

As you search for the best secured credit card for your situation, be sure to take all factors — such as rewards, fees, interest rate and ability to upgrade — into consideration before selecting a card.

Secured Credit Cards to Build or Start Credit

A secured credit card is a credit card product issued for consumers with less-than-perfect credit to build or rebuild their credit. The benefit of a secured credit card is that consumers can establish or improve their credit history without running the risk of overspending like with an unsecured credit card.


  • creditApproved icon

    FEATURED

    Capital One Secured Mastercard
    Best secured card for building credit on a budget

    • PoorCredit Needed
    • $49-200*Security Deposit
    • $0Annual Fee
    • 26.99% VariableAPR

  • Citi Secured Mastercard
    Best credit card for building credit with no or limited credit history

    • No/Limited CreditCredit Needed
    • $200 minimumSecurity Deposit
    • $0Annual Fee
    • 22.49% VariableAPR

  • Merrick Bank Double Your Line Secured Visa
    Best credit card for training good financial habits

    • PoorCredit Needed
    • $200 minimumSecurity Deposit
    • $36*Annual Fee
    • 17.45% VariableAPR

How We Rank Secured Credit Cards

We compile and rank our lists of suggested credit cards based on publicly available data from card issuers and other reputable sources like the Consumer Finance Protection Bureau. We analyze and compare over 55 data points for approximately 2,500 cards to assign a rating for each card feature. We roughly have about 260 secured credit cards in our database to analyze, compare and recommend the best cards to consider.

Top Rating Criteria for Secure Credit Cards

noAnnualFee
Annual Fee

Required fee if you want to keep your card.

lowInterestAPR
Regular APR

The percentage of interest you're charged if you carry a balance.

balanceTransfer
Ability to Upgrade

Does the card allow you to upgrade to an unsecured card?

Tips for Choosing the Right Secured Credit for You

If you are sure a secured credit card is the right option for you, there are plenty of ways to find the card that best suits your needs. It can be a bit daunting to pick through a long list of credit card options. As you are sorting through your options, remember these points:

1

Card issuer

Some secured credit card issuers are better than others in terms of customer service. If you have a question as a cardholder, nothing can be more frustrating than having a less-than-stellar customer service experience. So before selecting a card, make sure to research if consumers have had good or bad experiences working with the servicer.

2

Benefits of the card

While your main objective is to build or rebuild your credit, make sure you look at each card's perks, including whether it offers cash back, travel insurance or no foreign transaction fees. Weigh which ones benefit you the most.

3

Approval odds

It is impossible to know if you will be approved for a credit card. However, there are ways to give yourself the best chance possible. Research what credit scores are typically approved for the card, and align those with the credit score you currently have.

Secured Credit Cards Compared at a Glance

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  • Card Name
    Annual Fee
    APR
  • Capital One Secured Mastercard
    $0
    26.99% Variable
  • Citi Secured Mastercard
    $0
    22.49% Variable
  • Merrick Bank Double Your Line Secured Visa
    $36*
    17.45% Variable
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Secured credit cards are a great option for someone with no credit history or looking to rebuild their credit, but they aren’t the only option. Quickly compare other credit card options on our partner’s site.

MoneyGeek’s Quick Guide to Understanding Secured Credit Cards

A secured credit card is a bit different than a traditional, unsecured credit card. The main difference is that a secured credit card requires an up-front deposit to secure the credit line. The purpose of this is to protect the credit card issuer. However, the core benefit for secured credit card holders is that you can either build or rebuild your credit score, depending on your needs. But it will come with its share of limitations compared to an unsecured credit card.

Pros & Cons

Pros

  • Excellent way to build or rebuild credit
  • Spending is limited based on credit line allocated
  • Additional benefits may be available (i.e., rental car insurance

Cons

  • Credit lines tend to be limited
  • Up-front deposit required to secure the credit line
  • Rewards earned from spending are minimal to none

While a secured credit card is secured through an up-front deposit, remember that a credit card bill is still considered debt. Like anything else in your personal financial picture, managing debt is an essential skill that will help you balance a budget and grow your wealth. To begin moving the needle forward, the first step is to control your credit usage, and your spending habits are a large part of that. While a credit card is a great financial tool to earn rewards and build your credit history, you still need to be careful: credit card spending can also quickly get out of control and sabotage your efforts.

In addition, when considering a secured credit card, be sure to look at the benefits of each card. While they may not be as flashy as a travel or cash back credit card, there still may be opportunities to earn rewards for your purchases. If so, that can help you offset the costs of daily purchases that you would make anyway. However, you should never spend more simply to earn a cash back bonus.

Finally, keep in mind that a secured credit card is not the only way to build your credit score. You can utilize other methods, such as:

  • Paying bills that report to credit agencies
  • Looking into your credit report to see if there is anything you can correct, such as a missed payment or incorrect mark.
  • Applying for a credit-builder loan, or
  • Having someone add you as an authorized user to their credit card, among others.

You do not need to rely on a credit card to build your credit score.

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Remember that the goal is to eventually not need a secured credit card. Ideally, once you’ve made a series of on-time payments and have proven you can manage debt responsibly, you’ll apply and be approved for an unsecured credit card. That will give you more financial flexibility — and enable you to cancel or upgrade your secured card and get your deposit back.

The Capital One Secured Mastercard normally reviews accounts within good standing starting as soon as 6 months, while the Citi Secured Mastercard lets you convert to an unsecured card after 18 months. Find and apply one of these cards or a better option at our partner site, CardRatings.com.

How Do Secured Credit Cards Work?

Credit cards, in general, can be a tricky financial product to understand, but we are here to help. Secured credit cards work similarly to unsecured cards, but the consumer provides a full, up-front deposit of the card’s credit line. That is where the name “secured” comes from, as the card balance is secured by the up-front deposit you submit to the credit card issuer.

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HERE’S AN EXAMPLE
  • Joey has a less-than-perfect credit score, and he wants to rebuild his credit. He applied for a secured credit card and is approved for an $800 credit line. He will then need to submit an $800 payment to the issuer in order for the card to be active and ready to use.
  • At any time, his maximum spending limit is $800. However, some secured credit card issuers will review your credit history from time to time and possibly extend your credit line.
  • If Joey has spent $400 of his credit line, he will only be able to spend another $400. After that, the card will begin rejecting his purchases as his secured credit line is maxed out.
  • If Joey spends within his means and can pay off his bill each month, he will build his credit score to where he can eventually upgrade to an unsecured credit card.

Secured vs. Unsecured Credit Cards

There are several differences between secured and unsecured credit cards. Here are the main features that make each credit card type different:

Secured vs. Unsecured Credit Cards

Secured Credit Cards

  • Up-front deposit required to secure the credit line
  • Rewards earned from spending are minimal to none
  • Interest rates tend to be lower
  • Sign-up bonuses are typically nonexistent
  • Largest benefit is to build or rebuild credit

Unsecured Credit Cards

  • No up-front deposit required
  • Rewards earned from spending typically come in the form of cash back or travel rewards
  • Interest rates tend to be higher
  • Sign-up bonuses likely reflect the rewards earned from spending
  • Largest benefit is to earn rewards from spending, among other benefits

The most significant difference is the intent and design of each product. An unsecured credit card is designed to reward consumers with good-to-excellent credit for spending on their cards. A secured credit card is designed for consumers with less-than-perfect credit or no credit to build or rebuild their credit score.

Keep in mind that if a secured credit card is the best option for you right now, it is not a permanent option. The goal should be to use the secured credit card to rebuild your credit, then move up to an unsecured credit card.

Benefits to Using a Secured Credit Card to Start or Rebuild Credit

There are several benefits to using a secured credit card as an initial step into the credit card world.

  • First, a secured credit card only allows for so much spending. Because the card is secured with an initial deposit, you will only be able to spend that much before you pay the balance. This gives card users an excellent opportunity to understand if a credit card is suitable for them.
  • While an unsecured travel credit card has a credit limit, the card will not limit your spending and could cause issues if the cardholder spends beyond their means. But with a secured credit card, you can carefully examine your spending habits and work your way to an unsecured credit card.
  • In addition, a secured credit card allows consumers to steadily make positive progress on their credit report. By spending responsibly and paying your bill on time, you will build a history of controlled spending, which will build your credit score to a healthy score.
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Consider setting a budget for yourself using a budgeting app or a spreadsheet to manage your spending with your secure credit card. It’s a small action, but it will help to:

  • Identify spending patterns and monitor your spending closely.
  • Repair and build your credit score.

How to Use a Secured Credit Card to Build Credit

Using a secured credit card is a bit different than an unsecured credit card. Because an up-front deposit secures the card, you cannot spend beyond the deposit amount. This is a positive as you aren’t able to spend frivolously, but it’s also a negative because it doesn’t give you true spending flexibility.

The best way to use a secured credit card to build credit is to not spend excessively and always pay your credit card bill in full and on time. Doing so allows you to avoid interest charges as well as poor marks on your credit score.

However, improving your credit score significantly is not something you can do in one or two months. It is a long-term effort that requires persistence and responsible personal financial skills. While this sounds complicated, it boils down to two points:

  1. Do not overextend yourself, and
  2. Pay your bills on time.

If you can master those two skills, your credit score will climb.

Other Ways to Build Credit Without Getting a Credit Card

If you aren’t eligible for a secured credit card or prefer not to have one, there are several alternatives to help build or rebuild your credit score.

1

Become an Authorized User

For example, you could ask to be added as an authorized user on someone’s credit card. You’ll have access to their credit line, which will passively build your credit history — as long as they’re a responsible card user themselves. They don’t even have to give you a physical card to use.

2

Pay All Bills On Time

Also, be sure to pay your bills on time. Some bills report to credit bureaus directly, so any late payments or defaulting on bills could result in a bad mark on your credit.

3

Credit-Builder Loans

Another option is to apply for a credit-builder loan. A credit-builder loan works by limiting access to the funds until the loan is fully repaid. This means you can build savings and your credit at the same time. It also gives the lender security as your loan is secured with a deposit. Not all financial institutions offer a credit-builder loan, so you will need to search a bit. However, they can be very beneficial to building your credit score.

Common Questions About Secured Credit Cards

Secured credit cards are much different from a traditional unsecured credit card. Because they are so different, and credit card issuers don’t advertise them as heavily, there are many questions about how these cards work.

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About the Author


expert-profile

Brett Holzhauer is a personal finance reporter that has written for several leading publications and mentioned in many others such as Forbes Advisor, Lending Tree, CNBC and ValuePengiun. An alum of the Walter Cronkite School of Journalism at Arizona State, when he is not reporting, Brett is likely scuba diving, golfing or watching college football. He tweets regularly at @brett_holzhauer.


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*Rates or fees may vary or include specific stipulations. We recommend visiting the card issuer’s website for the most up-to-date information available.
Advertiser Disclosure: MoneyGeek has partnered with CardRatings for our coverage of credit card products. MoneyGeek and CardRatings may receive a commission from card issuers. To ensure thorough comparisons and reviews, MoneyGeek features products from both paid partners and unaffiliated card issuers that are not paid partners.