Sunday, 29 November 2020

Best Secured Credit Cards in 2018

Best Secured Credit Cards in 2018
14 Aug
5:36

Hey I'm Adam Jusko from ProudMoneycom and in this video I want to talk about the best secured credit cards on the market today

Before I do that, I would ask you to please subscribe to our YouTube channel if you haven't already and if you have I thank you So we're going to talk about the best five secured credit cards If you don't know completely what a secured credit card is, it's a way to build credit If you have bad credit or if you don't have a credit history and you want to build your credit, secured credit cards are a way to do it They are different from regular unsecured credit cards which is probably what you think of when you think of a credit card

You use these specifically to build credit and the way that works is you actually have to put a security deposit down in order to get the credit card Now the security deposit is refunded when you no longer want the credit card or when you no longer need the credit card or maybe if you get upgraded to a better credit card you might get that back But no matter what, you're putting a deposit down But this is not a fee, it is a basically a safety for the bank If you don't pay your bills, they'll grab that security deposit but otherwise it just sits there sort of as collateral and you get it back when you no longer need the card anymore

Now, when you get a credit card that is a secured credit card, you put that security deposit down but you have to realize that every month you are paying just like a regular credit card You use it just like a regular credit card you make your purchases, you're gonna get a bill at the end of the month, you have to pay it, and if you don't pay the full balance you're gonna get charged interest — all the ways that a regular credit card work are the same for a secured credit card

That security deposit is completely just there as a safety for the bank if eventually you don't pay, but your goal is to build your credit, so you are going to pay and you're gonna pay on time right? That's the whole reason that we're talking about them and it's probably the whole reason that you are interested in this video in the first place So let's go talk about what those five best are Now I am sticking with the for the most part the major credit card issuers as far as secured credit cards — number one, because most of them have the best terms, but, number two, a lot of these cards are going to use that secured card as potentially a way for you to build a relationship with them And since your ultimate goal probably is to get some of the more popular credit cards on the market, it makes sense for you to try to establish a relationship with some of the banks that are probably going to be issuing those cards that you're going to want in the future So, some of these cards will actually charge that security deposit up front but in the future they may take away or send you back that security deposit and let you keep using the card, and that's eventually the goal — to get that deposit back and either keep the card or move on to something better

So here are our top five The number one is the First National Bank of Omaha secured credit card, which maybe is not something that is familiar to you But this is actually a fairly large bank that does a lot of credit card issuing and they actually have what we consider to be the best secured credit card on the market There's no extra annual fee for this card, which some cards do charge, the interest rate is 1924% as of this video being made, which doesn't sound great but in the secured card market for people with bad credit or who are building credit that is not a bad interest rate to start with

And the big selling point here is that you may get your deposit back in as little as eleven months if you continue to make your credit card payments on time with this card It's not a guarantee, but if you continue to make your payments on time, you could get that deposit back and then you could go on and continue to use this card in an unsecured fashion instead of having that security deposit there anymore and you'll have that back in your pocket Number two is the Discover It secured card This is another card that has no annual fee, so you have to put your deposit down but you don't have to pay any extra for the card on top of that It has an interest rate as of now at a much higher place than the last card

This is at a 2449%, which is not an interest rate we particularly like However, this card has two other selling points that we do like And one of them is it offers rewards, which is very rare for a secured credit card You get 2% cash back on your gas and restaurant purchases, 1% cash back everywhere else

And this is another card that offers you a potential upgrade if you make your credit card payments on time They don't sort of give you a specific idea of when that upgrade may happen, but over time they're going to look at your account and decide if maybe they want to send you that security deposit back and let you continue to use that card For most of these cards you have to figure it's going to be at the very least six months before they would consider that In most cases it's going to be closer to a year before there's a possibility of them sending you your deposit back If you've had a different experience, someone with a secured card, I would love to hear that as well

But that is generally how it works So, number three is the Capital One secured card This is another card that has no annual fee, which is good It has a high interest rate as well, at 2499%, so that's not so great

But the third point is, after five billing cycles of having this card, assuming that you pay your bills on time and everything and you're sort of showing that you are responsible to Capital One, they will consider actually increasing your credit line without requiring a further deposit from you Initially with Capital One you're probably going to put down $200, you're gonna get a 200 dollar credit line, but if you continue to make your payments, they may increase that so, you know, you may go up to $500 or whatever but without putting a further security deposit down The only thing about Capital One that does not make them quite as desirable is they don't have any language that really suggests that after a certain point they will send your deposit back and then let you use the card in an unsecured fashion, so that is very unclear They are not, you know, sort of pushing that in their marketing So you might get that better credit line down the line, but you're not necessarily going to be upgraded to the unsecured card

Number 4, the Bank of America secured card This one actually does have a $39 annual fee that is in no way related to the security deposit you make — you're just gonna pay that annual fee and that doesn't come back to you The yearly interest rate is 2174% — not great but not terrible for a secured credit card This one, again, a major bank that is telling you that they will consider you for an upgrade down the line, will consider giving you your security deposit back and letting you continue to use the card

So again this is another way for you to potentially build a relationship with a major bank so that you can either keep this card, you know, if they do that or you can even hopefully down the line get yourself to a place where you have a little bit of a relationship with them and maybe you qualify for even a better card And then the last card is the US Bank Secured Card This card would be higher on our list if they offered any sort of language talking about upgrading you in the future, because the actual terms and conditions aren't so terrible It does have a $29 annual fee, but it only has an interest rate of 2149% as of the making of this video, so it's a little better in the interest rate area than some of these other cards

But again doesn't tell you anything about whether there's a possibility of an upgrade However, establishing a relationship with US bank, another major credit card issuer, is not a bad thing to do So, overall, secured credit cards are a very good way for you to potentially improve your credit history and improve your credit score — they're actually probably our favorite way to do it if you have bad credit or you're building credit And these are all good cards to consider to go down that path Going with the major banks makes good sense so you can build those relationships and hopefully move on to bigger and better things in the future

So, thanks for watching Please go to ProudMoneycom, where I will actually leave the link from ProudMoneycom to these cards if you want to go directly to their pages And then you can check out the rest of the site for other "best of" personal finance lists and credit card reviews and all kinds of other good stuff too

Thanks for watching Bye

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