Credit Cards For Dummies: The Best Options
I'm by no means a banker, Accountant, credit card specialist, or a professional budgeter. I have a lot of work to do myself. But I know there's always someone out there who's confused and looking for the right card for them, so here's the skinny on what I've found.
A little about me so you all can get the gist of who I am and what type of card I was looking for: I'm in my 20s, two and a half years into the corporate workforce, have had the same car since I was 16 which is paid off, and I have normal/decent credit for a young 20-something. My ideal card (initially) was one with zero annual fee and offered cash back, perks, or miles.
Let me know if you all would be interested in reading a separate post on my tips to keep in mind if you're considering applying for a credit card -- Would be too lengthy to include all of this together!
The Best Options
No Annual Fee:
Discover IT - This was my first "real" credit card aside from my Target Credit Card. I signed up for the Target card in college since I was buying so many of my purchases there, from sheets to groceries to cleaning supplies, and they offered 5% off all purchases. I knew I'd be able to pay the balance, and I was approved for a super small limit. The Discover IT card offered everything I wanted and focused on cash back. At the time, this sounded like the best option to me since it was literally money being put back in my pocket. This card offers specials every few months where you receive 5% cashback on select purchases. Sometimes it's gas, sometimes it's ground transportation (cabs, uber, etc), and sometimes it's online shopping. Some of the best perks:
- Dollar for dollar cash back at the end of your first year (if you're a new card member). So, if you earned $500 cashback at the end of your first year, Discover will put another $500 in your pocket once your year is up.
- 1% cashback on all purchases, any category.
- Cashback doesn't expire -- It can be transferred into your checking/savings account, applied to your balance, or used during checkout at select retailers.
- Customer Service is on point. I have to give huge props to Discover for their quality of customer service. They mailed me a couple Starbucks cards just because, were always quick and helpful on the phone, and answered all of my questions when I didn't understand anything.
Discover IT Miles - I ended up switching from the Discover IT card to the Miles card. The cashback that I was earning from the Discover IT wasn't impressive, and I wanted to start using a card that I could redeem travel rewards for. Perks:
- 1.5x miles on every dollar you spend
- Discover will match your miles at the end of your first year
- You can apply miles as a travel credit to purchase you've made (Keep in mind this is essentially the same thing as cash back, just a fancier name).
- $30 towards WiFi while traveling: It's usually about $8-$10 for WiFi purchase on a flight, so this covers you for about 3 trips.
Chase Freedom - I haven't used this card personally but have heard great things. Perks:
- 1.5% cashback on all purchases
- $150 bonus after you spend $500 on purchases in the first 3 months.
Annual Fee:
OK, so you might be wondering, as I was, why anyone would sign up for a card with an annual fee when there are tons of other options without one. I think the phrase "You get what you pay for" applies to credit cards as well. The perks of cards with an annual fee (which usually doesn't kick in until your 2nd year) are better, but it all depends on your preference and budget.
United MileagePlus Explorer - My current card. I debated this for over two years because of the $95 annual fee which applies after your first year, but damn I wish I had signed up earlier. I usually fly United, so the perks here benefited me more than the others had. What got me to apply:
- 30,000 bonus miles after you spend $1,000 in the first 3 months of opening. This is potentially a round trip flight if you shop smart. You can get one-way tickets on United for about 12,500 miles depending on where you're going.
- 5,000 miles after you add an authorized user. Add your mom, dad, whoever. They'll send you 2 identical cards, so you don't even need to give this person a card if you don't want to. But get them miles, honey.
- 1 mile per $1 and 2 miles per $1 spent on United.com
- Free checked bag and priority boarding. I was spending $25 to check a bag if I needed to each way which pissed me off. That's $50 per trip on luggage alone.
Chase Sapphire - If I didn't travel so frequently with United, this would have been my pick. I read this post by Courtney from TheBWerd and did some digging to see if it was the best card for me. All of the perks are great and are pretty similar to the United card. Perks for the Chase Sapphire:
- 50K bonus points after you spend $4,000 in the first 3 months (note that this is $3,000 more than United)
- 2X miles on travel and dining purchases
- Redeem for any airline
Does your head hurt yet?! Let me know if you're familiar with any of these cards or if you think I left a good option out. Let's work together, build our credit, and keep being a group of Girl Bosses!