It's no secret that having a low credit score can severely limit your options when it comes to getting a credit card. Many people with a 500 credit score assume they can't get any credit card at all. But good news! There are options for those who are struggling to improve their credit. In this article, we'll explore the best credit cards tailored specifically for those with a 500 credit score, helping you rebuild your credit and accomplish your financial goals.
Credit Cards For A 500 Credit Score Table of Contents
Secured Credit Cards
For those with a 500 credit score, secured credit cards are a great option. These cards require a security deposit, which becomes your credit limit. This guarantees the issuer that you'll make good on your purchases – a win-win scenario for both parties! Here are some popular secured credit card options:
- Capital One Platinum Secured Credit Card: This card has a $0 annual fee and offers a flexible security deposit. You can deposit $49, $99, or $200 to receive a credit limit of $200 to $1,000, based on your creditworthiness.
- Discover it Secured: Not only does this card have a $0 annual fee, but it also offers cash back rewards. You'll earn 2% cash back at gas stations and restaurants and 1% back on all other purchases. Plus, Discover will match all cash back earned in your first year!
- OpenSky Secured Visa Credit Card: This card doesn't require a credit check, meaning you won't face a hard inquiry that could hurt your credit score more. The annual fee is $35, and you can choose a credit limit from $200 to $3,000.
Unsecured Credit Cards for Bad Credit
While secured credit cards are the most common option for those with low credit scores, there are also unsecured credit cards specifically designed for people with bad credit. Keep in mind that these cards often come with higher interest rates and fees. Here are a few options:
- Credit One Bank Platinum Visa for Rebuilding Credit: This card offers 1% cash back on eligible purchases, such as gas, groceries, and services. There's an annual fee of $75 for the first year, then $99 per year after that, but the rewards might be worth it for some.
- Indigo Platinum Mastercard: Tailored to those with a rocky credit history, this card has an annual fee ranging from $0 to $99, depending on your creditworthiness. The card reports to all three major credit bureaus, helping you improve your credit score over time.
- Milestone Gold Mastercard: With a yearly fee of $35 to $99, this card offers a quick pre-qualification process that doesn't impact your credit score. Again, this card reports to all three major credit bureaus.
Credit Cards For A 500 Credit Score Example:
Let's say you have a 500 credit score and have decided to apply for the Capital One Platinum Secured Credit Card. After you've been approved, you make a security deposit of $200, which becomes your credit limit. With responsible use of your new card, such as making payments on time and not exceeding your credit limit, you'll see your credit score start to improve.
Improving your credit score is essential for reaching financial stability and taking advantage of better credit card offers in the future. With the right card in your wallet, such as a secured or unsecured credit card for bad credit, you can work your way towards better credit. Remember, using your card responsibly is key to rebuilding your credit score.
If you found this article helpful, be sure to share it with friends and family who might also be looking for credit card options for a 500 credit score! And don't forget to check out our other guides on Flik Eco for more personal finance and investing tips tailored to millennials. Together, let's build a brighter financial future!