Secure and Ready

What to know about secured credit cards

A secured credit card can be a good way to build credit. With normal credit cards, the issuer approves you for a line of credit based on your ability to pay any debts. However, with a secured credit card, there is no consideration needed. You make a deposit to the card and then you’re issued a line of credit equal to that amount. Here’s what you should look for when considering a secured credit card.


As USA Today notes, you want your lender to report your credit use to the three credit bureaus. If your secured card activity isn’t reported to the bureaus, you won’t get the chance to build your credit score.


Most, but not all, secured credit card lenders offer you the chance to move on from a secured card once you’ve proven you can handle the payments. Make sure your lender has this transition built into the secured card. The goal is to eventually open an unsecured card and reap the benefits of using it smartly.

Low/No Fees

Some secured cards come with loads of fees. These lenders know you want to build your credit and they hope that you don’t read the fine print. Don’t fall into that trap. There are plenty of free secured credit cards available, you just have to do some research to find them.

Chris O'Shea

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