The 30-Second Review

If you’re serious about improving your credit, you’ve probably heard that getting a secured credit card is an effective way to build a history and raise your score. There’s plenty of secured cards out there vying for your attention, but the best supports your goal of saving money and staying out of debt with low rates, low minimum deposits, and manageable annual fees. Even better: No annual fee at all.

Best Secured Credit Card

The flagship secured credit card offered by First Progress has a fairly steep annual fee ($49) but the super low APR and high credit limits are ideal for taking control of your credit and building your credit trustworthiness quickly.

  • January 19, 2018 - In the original edition of this review, we researched 25 top secured credit cards and landed on the best six based on stand-out features and pricing structure. One of our top picks is no longer offered and the costs and fees of the others have changed. We’ve updated our picks and our comparisons to reflect the new landscape and offer further guidance to finding your best credit-building card.

The Best Secured Credit Cards

What is a secured credit card?

Credit cards operate on trust — the credit card company takes on your debts with the understanding that you will reimburse them when your bill’s due. A secured credit card doesn’t operate on trust alone. As the name suggests, they use security. Like a normal credit card, you charge expenses and pay the total later. But like a debit card, you invest the amount you’re able to pull out. You put down the total cash amount that you will be permitted to charge, giving the credit card company the equivalent of a pet deposit. If at the end of your contract, the carpets are clean — you’ve paid all your bills — you get that deposit back.

Rather than applying for a whole slew of secured credit cards, track your top priorities to our top suggestions, then apply for one or two cards at most. You may be eager to apply for several right out of the gate, but submitting lots of applications will actually hurt your credit score. Every application authorizes the credit card company to submit a hard inquiry, and that causes your score to temporarily dip.

Which secured credit card features matter and why

  • Credit Limit refers to the amount of money that the cardholder can charge. Ideally, you want to be able to increase the credit line on your card as you show a good payment history or put down additional money toward the security deposit. An increased credit line is linked to an improved credit score. Two numbers you want to know about any secured credit card: Minimum and maximum credit lines. Our top picks show an impressive range — exactly what you want so you can start with whatever you have but also get plenty of room for growth.
  • Security Deposit is one of the main considerations when comparing secured credit cards. You want an affordable security deposit when starting out, and some of the top cards offer ones that are less than $200. But you also want the option to grow your security deposit, and earn some interest on it in the process. We only considered card companies with security deposit that are fully refundable and FDIC-insured.
  • Penalty Fees can accrue if you spend above your credit line, don’t pay your bill on time, or if your payment gets returned. If improved credit is your aim, you should be doing everything you can to make sure you pay in full and on time, every month. But if you forget or if cash is tight, you don’t want to be hit with hefty charges. The best secured credit cards minimize their penalty requirements and do their best to inform cardholders about the consequences of non-payment and help them avoid it altogether. That means allowing a grace period before interest starts to accrue, and not charging for late payments, returned payments, going over your credit line, or for paying your entire bill. That’s right — some credit cards actually penalize you for having a $0 balance. Minimum interest charge is the last thing we wanted to see.
  • Rates and Fees come with the territory of owning a secured card. These include introductory and standard rates, the cost of annual membership, and whether the issuer charges foreign currency transaction fees. In general, the issuers will charge an annual fee and a cash advance fee, but in some cases, cards will not charge a foreign transaction fee. For those who plan on carrying a balance on the card, looking for a lower APR will be a key selling point.
  • Balance Transfers move existing balances (whether a loan or another card) onto your secured credit card, and usually come with transfer rates. The majority of secured credit cards don’t allow any balance transfers, which makes this category less important. However, having the ability to move money with ease (and no surcharges) nice additional feature.
  • Application includes all the steps you have to take to get a secured card, and whether instant approval is available. Instant approval is a feature offered by most credit cards, but it is often dependent upon creditworthiness. Having the ability to apply online is the most important option, but in certain circumstances, it might be convenient to apply on the phone or in person.
  • Benefits refer to the extra things provided to a secured credit cardholder. Most cards come with benefits, but the ones associated with secured credit are unique. Typically, they focus on credit monitoring and automatic credit reporting. The benefits for the best cards are not overwhelming, however, having a card that automatically reports and monitors credit, while also providing fraud liability can be of a lot of help in keeping your financial goals on track.

Our Picks for the Best Secured Credit Card

Best Secured Credit Card

This top-tier secured credit card from First Progress levies a fairly hefty annual fee, and fixed costs like this one are important to consider when shopping around. But in this case, the trade-off makes the required payment worth it. Platinum Prestige’s interest rate is nearly on par with traditional credit cards, plus you have lots of overhead to expand your credit line. Together, these features create lots of opportunity for you to turn your credit score around in short order.

Best Minimum Security Deposit

The amount you put down depends on your credit-worthiness, but your security deposit with Capital One could be as low as $49. Plus, after making your first five payments on time, you’re eligible to increase your credit line.

Best Annual Fee

The $29 annual fee is as low as you’ll find across secured credit cards, and a major draw if your primary concern is not shelling out for more than you have to. But keep in mind that low annual fees usually come with increased interest rates. If you opt for Platinum Elite, avoid carrying a balance on your card from month to month. The steep 20% interest rate is on the high end.

Best for Credit Monitoring

The middle-of-the-road option between the super low interest rates of Platinum Prestige and the super low annual fee of Platinum Elite, this $39 / 15% APR secured credit card is best for people who want to take a moderate approach to building credit and not commit to high payments in order to benefit from price cuts elsewhere.

The Best Secured Credit Cards: Summed Up