Types of Credit Cards

Whether you are looking for a credit card with rewards, a low-interest rate, or a 0% introductory balance transfer period, there are plenty of options out there. Below, we break down the various types of credit cards to help you find one that’s right for you.

Unsecured Credit Cards

Unsecured credit cards are the most popular kind of credit card. Unlike secured cards, which require you to put down cash as collateral, unsecured cards don’t require you to use your own money as security. These cards are good for most consumers and can help build credit when used responsibly. Many unsecured credit cards also offer rewards like cash back and points. Some unsecured credit cards are offered for free, while others have an annual fee.

Secured Credit Cards

If you have no credit history or your credit needs work, a secured credit card can be a good option for you. Typically, secured cards require that you deposit money with the bank to secure your line of credit. This deposit amounts to your credit limit. Although secured credit cards offer limited rewards, they can be a good option for those who are looking to build their credit score. Remember that once your credit score improves, you can apply for an unsecured credit card that offers more perks.

Balance Transfer Credit Cards

If you’re looking to save money on interest, a balance transfer card might be a good option. Balance transfer credit cards help you move high-interest debt from other credit cards or lenders and typically offer a 0% introductory APR for a certain period of time. It’s important to note that the introductory rate won’t last forever, so make sure you have a plan to pay down debt within the promotional period.

Student Credit Cards

Student credit cards are essentially designed for college students who have little or no credit history and want to start building their credit. While these cards are easier to get approved for, they also typically have lower credit limits. Student credit cards tend to have higher interest rates, so it’s important to be careful when making purchases with them.