The Best Secured Credit Cards

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A secured credit card is one of the best tools you can use to build good credit from scratch or rehabilitate bad credit. They're great to start with, but the journey to a good credit score goes a lot smoother when you have incentives to make good decisions and don't have to pay a ton of fees along the way. That's exactly what we looked at when evaluating secured credit card offers.

Editors' Picks

Best Overall

Discover it® Secured

For Secured Credit Cards
4.5
Discover it® Secured
Recommended Credit Score Our recommended ranges are based off of the FICO® Score 8 credit-scoring model. Credit score is one of the many factors lenders review in considering your application.
350 579
580 669
670 739
740 799
800 850
Poor - Excellent
  • Regular APR (%) 25.24% variable
  • Annual Fee No Annual Fee
  • Minimum Deposit to Activate $200
  • Allows upgrade to unsecured card Yes

Why We Chose This Card

The fact that this card has no annual fee makes it attractive from the start, but when you add rewards to that equation, Discover it Secured is really valuable. Keep your balance low and pay it off on time every month, and Discover could upgrade your card to the unsecured version as soon as eight months from when you open the account. We also consider this card the best secured card for low fees, rewards, and customer experience.

Best for Low Deposit

Capital One® Secured Mastercard®

For Secured Credit Cards
3.9
Capital One® Secured Mastercard®
Recommended Credit Score Our recommended ranges are based off of the FICO® Score 8 credit-scoring model. Credit score is one of the many factors lenders review in considering your application.
350 579
580 669
670 739
740 799
800 850
Poor - Excellent
  • Regular APR (%) 26.99% variable
  • Annual Fee No Annual Fee
  • Minimum Deposit to Activate $49
  • Allows upgrade to unsecured card No

Why We Chose This Card

Most secured credit cards require at least a $200 deposit to activate the account—not this one. Some people will qualify for a $200 credit line with as little as a $49 deposit. It’s also great that Capital One starts reviewing your account for a potential credit line increase if you make your first five monthly payments on time, because a higher credit limit makes it easier to develop a good credit utilization rate.

Best for Low Interest

Wells Fargo Secured Credit Card

For Secured Credit Cards
4.0
Wells Fargo Secured Credit Card
Recommended Credit Score Our recommended ranges are based off of the FICO® Score 8 credit-scoring model. Credit score is one of the many factors lenders review in considering your application.
350 579
580 669
670 739
740 799
800 850
Poor - Excellent
  • Regular APR (%) 20.99% variable
  • Annual Fee $25.00
  • Minimum Deposit to Activate $300
  • Allows upgrade to unsecured card Yes

Why We Chose This Card

Secured credit cards often have APRs in the 24%-26% range, and the Wells Fargo Secured's is much lower. True, a double-digit APR is still pretty high, but in the event you end up carrying a balance on your card, every percentage point matters. This card is also our top secured card that allows high credit limits.

What Are Secured Cards & How Do They Work?

Secured credit cards are similar to regular, unsecured credit cards. However, secured cards require applicants to make a deposit (usually $200, minimum) to open a card. That deposit is held by the issuer just in case you don’t pay your bill, and usually dictates your credit limit. Typically, the more you deposit, the higher your limit.

Warning

A secured card deposit doesn’t cover your monthly card bill. You’ll still owe minimum monthly payments, and if you don’t pay the full balance, you’ll be charged interest, just as you would with an unsecured credit card. 

You can get your secured card deposit back when you either close the account in good standing, or upgrade to an unsecured card account. Some issuers will review your account automatically after a certain period and let you know if you qualify for an unsecured card. 

Another option is to close the account once you’ve built up enough credit to be approved for a better card through a different credit card company. How long this process takes all depends on how your credit score responds to the positive account history. If you started with no credit, it may only take six months of secured card use to improve your score, CPA and senior financial analyst Riley Adams told The Balance. 

However, if you’re rebounding from bad credit, you may need to use the secured card for much longer to demonstrate you’ve really changed your credit behavior. Two credit counselors we spoke to both recommend using a secured card until you have a good credit score.

Who Are Secured Cards For?

If you have no or very little credit history, or a poor credit history and low credit score, a secured card can help you build (or rebuild) credit. In fact, it may be your only option. Banks usually want to see that you’ve handled credit responsibly in the past before they’ll approve you for a regular credit card. However, because secured card issuers have a deposit to fall back on, risky applicants are more likely to be approved. 

Important

Not all issuers will check your credit record when you apply for a secured card, but they may ask for income information, bank account details, and some may also check for recent bankruptcy records, which can disqualify you.

Pros and Cons of Secured Cards 

Pros

  • People with no, little, or bad credit can qualify

  • Credit check may not be required for approval

  • Can help you build a positive credit history

  • Widely accepted as long as the card is affiliated with a major network such as Visa and Mastercard

Cons

  • Requires a deposit

  • Credit limit may be low, depending on how big your deposit is

  • High interest rates, often above 24%

  • Annual fees and other fees are common

  • Rarely offer rewards

Do Secured Cards Really Help Your Credit?

Yes, if used wisely. 

Most secured card issuers report accounts to the three major credit bureaus, so you can use these cards to demonstrate responsible credit management, like on-time payments and low card balances. 

What to Look for in a Secured Card

When reviewing secured card offers, make sure they have at least some of these favorable qualities: 

Prequalification

With prequalification you can comparison shop without submitting multiple card applications. Prequalifying for a card means before you formally apply, the card issuer will perform a soft credit check, not a hard credit check—which would ding your credit score. The card company will get just enough information to know if you’re a good candidate for the card. 

Note

Prequalifying for a card doesn't guarantee the issuer will approve your application. But it's better than blindly applying.

Allows Deposit Payments Over Time

Some secured card issuers allow you to make deposits in installments to reach a higher credit limit over time, which is a great option. Other cards only allow one-time deposits, which means you’ll have to fork over a large sum right away to access a decent credit limit. 

High Credit Limits

This is especially key if the card allows you to have credit limit that’s more than your deposit. It's rare, but it's out there. Beyond that, a few other card companies still cap your credit limit at the amount of your deposit, but they allow larger credit limits—up to $10,000 in some cases. Higher credit limits make it easier to keep your balances much lower than your credit limit, which keeps your credit utilization ratio (a key factor in determining your credit score) in check.

Few Fees

Besides common credit card fees, such as annual fees, some secured cards also charge monthly maintenance fees, an application fee, and a host of other fees. Avoid secured cards that are packed with extra fees. 

Card companies are required to disclose fee information and you’ll usually find it by looking for a link in small type on the page that says, “Terms & Conditions,” “Rates and disclosures,” or something similar.

Credit Monitoring Tools

Since these cards are intended for building credit, it’s great when issuers offer you access to a free credit score and other resources to help you track your progress and better understand how card use impacts your score.

Bonus: Rewards

It’s rare, but a handful of secured cards offer rewards. For example, if you charge $100 on your card, you’ll get $1-$2 in cash-back rewards. Here’s a basic explainer about how credit card rewards programs work. Rewards are definitely not a necessity, but a nice-to-have. 

How to Use Secured Cards

  • Use like a regular card and charge only what you can afford. 
  • Make on-time payments, ideally paying off the balance in full each month.
  • Keep tabs on your credit score to track improvement, and watch your credit report for errors or fraud.
  • Check in with the card company once your credit score reaches the mid-600s to see if you’re eligible for an unsecured card upgrade, unless they automatically review your account sooner.
  • Once your credit is strong enough to qualify you for a better, less costly card, apply for one, close the secured card, and get your deposit back. 

Methodology

At The Balance, we are dedicated to giving you unbiased, comprehensive credit card reviews. To do this, we collect data on hundreds of cards and score more than 55 features that affect your finances.

Note

Our reviews are always impartial: No one can influence which cards we review, the way we present them to you, or the ratings they receive.

The scores and reviews come directly from the data we collect and our editorial expertise, and we focus on three areas:

  1. How much does it cost? With credit card debt at an all-time high, we believe you should know the cost of carrying a balance. Because of that, we give regular purchase APRs significant weight in overall scores, and cards receive low marks if they have an array of pricey fees. 
  2. What are the rewards worth? Cards accumulate rewards in different currencies—points, miles, cash back—and their values vary widely. To simplify the problem, we built a system that fairly compares rewards and gives them a dollar value. We do this by looking at the ways you can earn and use rewards, which includes evaluating Americans’ typical spending habits and analyzing common travel patterns. 
  3. Does it make your life easier? Our scoring system favors cards that accept a wide range of credit profiles and offer simple solutions for things like checking your credit score or contacting customer service. Finally, we give preference to credit cards that have several tools for dealing with fraudulent charges. 

For every review on The Balance, we hold the credit cards to these standards, and we set the bar high. While we recognize the appeal of splashy features like six-digit sign-up bonuses, our approach ensures that credit cards with the best combination of value, affordability, and accessibility receive the highest scores. See our full methodology for more details.