Credit cards are a valuable tool for improving your credit score, protecting your money, and broadening your access to other financial products like loans. But with so many different types of cards available, it can be challenging to know which is right for you.
Understanding your current credit score, your spending habits, and your future financial expenses will help you identify the card that best meets your needs.
Once you’ve discovered the best fit, applying for a credit card is quick and easy!
1. Find Your Credit Score
What Is a Credit Score?
Your credit score is essentially a grade, and your grade sits somewhere between 300 (poor) and 850 (excellent).
Your credit score is determined by the top three credit bureaus: Experian, TransUnion, and Equifax. They consider factors like the length of your credit history and whether you pay your bills on time and in full. Using this information, they calculate your credit score, which financial institutions use (among other details) to determine how reliable a prospective customer would be as a borrower.
You may have also heard the term “FICO score.” This is the most popular type of credit score, so it’s often used interchangeably with “credit score.” FICO scores are ranked as follows:
- Poor: 300 to 579.
- Fair: 580 to 669.
- Good: 670 to 739.
- Very Good: 740 to 799.
- Exceptional: 800 to 850.
Where Do You Find Your Credit Score?
First things first: you are legally allowed to receive one free credit report every year from each of the three credit bureaus. That said, there are alternative sites you can use to view your credit score for free throughout the year.
To get your credit score and report for free, consider a company like Credit Karma or Credit Sesame. Heads up: you’ll likely receive a “VantageScore” (between 501 and 990) as opposed to your “FICO score” (between 300 and 850), but the results should be close to your true credit score.
Read more: Why Your Credit Score Is Different Depending Where You Look
Finally, you will need to provide your SSN as well as some additional personal information to pull your score, but make sure you avoid any sites that request a credit card number.
Read more: How to Get a Free Credit Report and Credit Score
Which Card Should You Apply For, Based on Your Score?
Once you’ve established your credit score, you’re one step closer to identifying the right credit card for you.
Apply for a card that helps you grow and/or maintain your score. For example, individuals with poor credit won’t qualify for many traditional credit cards, but they’re likely eligible for a secured credit card, which will allow them to build up their score over time.
For guidance, refer to our picks for the top credit cards for your specific rating:
- Best Credit Cards for Credit Score Under 599
- Best Credit Cards for Credit Score Between 600 and 649
- Best Credit Cards for Credit Ccore Between 650 and 699
- Best Credit Cards for Credit Score Between 700 and 749
- Best Credit Cards for Credit Score Above 750
2. Choose the Right Card for Your Needs
Credit cards typically fall into one of six categories:
- Secured credit cards.
- 0% intro APR credit cards.
- Student credit cards.
- Travel rewards credit cards.
- Premium (paid) rewards credit cards.
- Regular rewards credit cards.
In addition to knowing your unique score and what it means, understanding the different types of credit cards available will also help you find the option that’s best suited to your needs.
Read more: The Different Types of Credit Cards — Everything You Need to Know
Secured Credit Cards → For Poor Credit
Secured credit cards are an ideal option for individuals with poor credit, because they provide cardholders with an opportunity to build up their score.
Instead of trusting you’ll repay your credit card debt on time and in full, secured credit cards require a cash security deposit from cardholders, which they can pull from if you miss a payment.
Once you’ve proved your reliability and built up your credit, the issuer may then help you upgrade to one of their regular rewards cards (and refund your deposit).
If you feel this type of credit card is right for you, check out our picks for the best secured credit cards.
0% Intro APR Cards → For Carrying a Balance
If you have good or excellent credit (670+) and think you may need to carry a balance month-to-month, consider a card offering 0% intro APR.
You’ll typically see this type of offer advertised for a year or more, and thankfully it’s exactly what it sounds like — you won’t be charged a dime of interest so long as you pay off your card’s total balance within the timeframe allotted. Some even offer 1.5% unlimited cash rewards as an added perk.
Just remember not to max out your card, since that can negatively impact your credit score.
If you’re interested in a balance transfer, see our picks for the best 0% APR credit cards.
Read more: How Do Credit Card Balance Transfers Work?
Student Cards → For Students
If you’re still in school, you may have limited income and credit history. Fortunately, there are credit cards designed specifically for your needs, too. Like secured credit cards, student cards can help you build your credit, while earning some rewards.
See our list of the best credit cards for college students if you think a student card suits your needs.
Read more: What You Need To Know About Applying For a Credit Card With a Limited Income
Travel Rewards Cards → For Frequent Travelers
For those who are always on the move and spend big on flights, rental cars, and hotels, a travel rewards card will likely be the best fit.
This option contains a wealth of benefits that make traveling easier, such as complimentary trip insurance, lounge access, and a 24/7 concierge you can call for booking help.
However, a word of caution: many (but not all) travel rewards cards have annual fees, so it may not be worth the money if you don’t travel regularly.
If this sounds like you, check out our picks for the best travel rewards credit cards.
Premium (Annual Fee) Rewards Cards → For Big Earners, Big Spenders
As is the case with many travel rewards credit cards, premium rewards cards often charge an annual fee (typically $95 to $695). However, if you earn and spend a lot and have very good or excellent credit (740+), the rewards may compensate for the fee.
Premium rewards cards come jam-packed with industry-leading perks, benefits, and up to 10% cash rewards on qualifying purchases. If your current spending habits would qualify for these rewards, you should certainly consider a premium rewards card. However, a premium rewards card is not ideal for a first credit card, as annual fee cards can suck cardholders into spending money they can’t afford.
Read more: Is an Annual Fee Credit Card Ever Worth It?
Regular Rewards Cards → For Everyone Else
For the majority of first-time cardholders, a good ol’ vanilla rewards card will do just fine.
These days, your average rewards card will have the following features:
- Credit required: 670+.
- Cash rewards: 1.5% – 5% cash rewards on eligible purchases.
- Intro sign-up bonus: $150 – $250.
But like a good froyo, rewards cards can come with all kinds of toppings and flavors. They may provide 0% APR in addition to rewards, some might feature more travel benefits, and others may even offer 2% unlimited cash back on everything.
Check out our list of the best rewards credit cards for some good all-round options.
3. Consider Sign-Up Bonuses
As you’re evaluating potential options for your next — or first — credit card, you’ve likely seen promotions for free points, miles, or even cash. It’s quite common for credit card companies to incentivize prospective cardholders with a welcome bonus, and if you’re seriously considering a new credit card, you should definitely keep an eye open for these promotions.
To qualify for these intro offers, you’ll typically need to meet a spending requirement within the first few months after opening your card, usually a few thousand dollars. Before you take the bait and apply, make sure you can meet this spending requirement with your current spending habits! You should never spend more money than you otherwise would for the sake of a bonus.
Check out our picks for the best credit card sign-up bonuses to see if you can get some extra rewards with your new card.
4. Don’t Forget About Pre-Approval
Pre-approval is an optional step to see which cards you might get fully approved for without making a hard pull on your credit.
Why Should You Get Pre-Approved?
If you’re right on the cusp of a card’s credit requirement (such as 667, when the bank requires 670+), pre-approval may save you from the disappointment of getting rejected, the hassle of applying, and the ding to your credit score.
Additionally, if you’re considering more than one card, you can use the pre-approval process to help narrow your options.
How Do You Get Pre-Approved?
During the pre-approval (or pre-qualification; see below) process, a credit card company will typically request the following information, so make sure you have it on hand:
- Social Security number.
- Monthly rent/mortgage.
- Credit score estimate.
After you’ve gathered the appropriate info, there are a couple of ways to get pre-approved.
1. Respond to a Pre-Approval Offer
First, you can wait for the credit card company to send you an offer, either electronically or via the mail.
These offers differ from a general credit card advertisement, because the credit card company has already pre-screened your credit report to make sure you meet the basic qualifications for their card.
In other words, they’ve already identified you as an ideal candidate, so they’ll provide a unique offer to you that’s not advertised in their broader marketing materials, such as an introductory 0% APR period.
Keep your eyes peeled for mail with “pre-approved,” “pre-qualified,” or “pre-screened.” Sometimes, the credit card issuer will include an invitation code you can use to apply online.
However, keep in mind that pre-approval does not ensure approval; you will still need to complete the credit card application to determine your eligibility.
2. Request Pre-Qualification
If you’d rather not wait for a credit card company to contact you or if you know you’d like a credit card from a specific company, you can also inquire about a pre-qualification offer.
Pre-qualification differs slightly from pre-approval. With pre-approval, the credit card company has already “skimmed” your credit report to make sure you meet the basic requirements for their card. Pre-qualification, however, means you are the one to reach out. For instance, you might fill out some basic info on the credit card company’s website and then receive a summary of the cards you are pre-qualified for.
Read more: How To Get Pre-Approved for a Credit Card
5. Gather Your Info and Apply!
Once you’ve selected the credit card(s) you’d like to apply for, there are a few different ways to complete the application, as well as some specific information you’ll want to have on hand.
Where to Apply
Nine times out of 10, the simplest and fastest way to apply for your new credit card will be through the company’s website. That said, if you have additional questions or concerns about the card in question, you can apply in person instead (if the credit card issuer has a physical location near you) or over the phone.
Lastly, you can also submit your application via snail mail, but be prepared for a longer wait to determine whether or not you’ve been approved.
What You’ll Need to Apply
Most credit card applications will request the following information, so make sure you have it available when you’re ready to apply:
Your full name, DOB, address, and SSN are a few details the credit card issuer will request to verify your identity. For most credit card companies, only U.S. citizens with Social Security numbers can apply.
Income and Expenses
Your bank will request your annual income as well as your mortgage/rent so they can gauge your ability to pay off your card each month. They typically don’t ask for proof via pay stubs or W-2s, but make sure you’re honest nonetheless. If you bend the truth, it will come back to bite you!
If you want an extra card for your child, spouse, or another person, list them as an authorized user on the application. Keep in mind that authorized users are not the same as co-signers. That said, you alone are responsible for making the monthly payment on your credit card.
Balances to Transfer
Lastly, if you’d like to initiate a balance transfer from your old credit card to your new one, you’ll include that information in the application as well.
Applying for a credit card isn’t a complicated process. However, it’s important that you research options thoroughly before submitting an application.
There is a wide variety of credit cards on the market, designed for all different types of people. For instance, your credit score will help determine which credit cards you qualify for, and how you spend your money now will help you identify a card that rewards your current spending habits. You may even find a card that rewards your spending with a welcome bonus.
Once you’ve found the right card for you, consider seeking pre-approval before submitting the formal application.
After pre-approval, the hardest work is behind you, and you’re ready to apply!