Updated on Aug 14, 2017

Best Secured Credit Cards of 2017

Take the first step toward positive credit with a secured credit card
Saundra Latham
By
Advertiser Disclosure

This page includes analysis of our favorite cards from The Simple Dollar’s advertisers and the marketplace. Visit our advertiser disclosure to learn more.

If you’re dealing with no credit or a poor credit score, then you know that building up your credit takes time and patience. Using a secured credit card is one such tool to move in the right direction. Though they do require a security deposit, the best secured credit cards can help you to build positive credit when used in an educated and responsible manner. Check out our shortlist of the best secured credit cards of 2017 and apply online—it’s quick and easy!

Summary

Best secured credit cards of 2017

The Simple Dollar’s top picks

Best overall

Discover it® Secured Card - No Annual Fee
Security deposit $200 to $2,500
Reward details 2% cash back at restaurants & gas stations; 1% cash back on other purchases

Free monthly credit score Available
Annual Fee $0
Highlights Provided by Discover Show Highlights
Card Highlights Provided by Discover:
  • New! We’ll monitor your Social Security Number. Get an alert if we find your Social Security Number on any of thousands of risky websites.* Activate for FREE.
  • No Annual Fee, cash back on every purchase, and helps you build your credit with responsible use.
  • Your Secured Card requires a refundable security deposit up to the amount we can approve of at least $200 which will establish your credit line. You will need to provide your bank information when submitting your security deposit.
  • We will automatically begin reviewing your account starting at 8 months to see if we can transition you to an unsecured line of credit.
  • Earn 2% cash back at restaurants & gas stations on up to $1,000 in combined purchases each quarter. Plus, 1% cash back on all your other purchases.
  • Get a dollar-for-dollar match of all the cash back you’ve earned at the end of your first year, automatically.
  • Click "APPLY NOW" to see rates, rewards, FICO® Credit Score terms, Cashback Match™ details & other information.
  • Issuer: Discover
  • Rewards Details: 2% cash back at restaurants & gas stations on up to $1,000 in combined purchases each quarter. 1% cash back on all your other purchases.
  • Annual Fee: $0
  • Balance Transfer Fee: 3%
  • Cash Advance APR: 25.99% Variable
  • Introductory APR: N/A
  • Introductory APR Period: N/A
  • Introductory Balance Transfer APR: 10.99%
  • Introductory Balance Transfer Period: 6 months
  • Ongoing APR: 23.99% Variable

Our two cents

Who should get it

Anyone with limited credit who wants a secured card that offers more should consider the Discover it® Secured Card - No Annual Fee. There’s no annual fee, and a minimum deposit of $200 is required to open the account. Once you’re a cardholder, you’ll benefit from 2% cash back at restaurants and gas stations on up to $1,000 in combined purchases each quarter, plus 1% cash back on all other purchases. You’ll also automatically receive a dollar-for-dollar match on all cash back earned within the first year. Bonus: You could qualify to have your security deposit refunded after eight months of responsible use—another reason you’ll want to pay on time and in full each month.

How to use it
  • Your credit limit will be equal to your initial deposit of $200 or more. To keep credit utilization low (a major factor in your credit score), carefully consider any large purchases and pay off your balance in full each month.
  • Use your card to make purchases at restaurants and gas stations to earn 2% cash back, up to $1,000 in combined purchases each quarter. Plus, get 1% cash back everywhere else.
  • Pay your balance in full and on time each month to build your credit, avoid paying interest, and possibly receive a deposit refund.
  • Watch your credit score improve with FICO® credit score reporting, free on your monthly statements.
Consider this

While there are a lot of perks with the Discover it® Secured Card - No Annual Fee, it is still a secured credit card. If your credit score is poor, but not severely damaged, you may want to check if you can qualify for an unsecured credit card to avoid the upfront deposit. Many offer free pre-qualification checks that won’t hurt your credit score.

Why you'll love it

Just because you have limited credit doesn’t mean you have to settle for limited options. The Discover it® Secured Card - No Annual Fee offers all of the advantages of a secured credit card to rebuild your credit, plus additional benefits like cash back rewards and cash back matching. The rewards you’ll earn on everyday purchases make this card our top choice among the best secured credit cards.

Start your application now

Best for military members and their families

USAA Secured Card® Platinum Visa®
Security deposit $250 to $5,000 in the form of an interest-earning CD
Reward details None. However, your CD will earn interest at a variable rate over two years.

Free monthly credit score Available
Annual Fee $35
Highlights Provided by USAA Savings Bank Show Highlights
  • Best for members rebuilding or establishing credit.
  • Determine your own credit limit ($250 to $5,000) with an interest-earning CD.
  • No foreign transaction fees when you travel outside the United States.
  • Issuer: USAA Savings Bank
  • Annual Fee: $35
  • Balance Transfer Fee: 3% of the amount of each transfer (maximum fee per transfer $200).
  • Cash Advance APR: 10.90% to 20.90%
  • Introductory APR: N/A
  • Introductory APR Period: N/A
  • Ongoing APR: 10.90% to 20.90%
  • Penalty APR: None

Our two cents

Who should get it

Military personnel and their families should consider the USAA Secured Card® Platinum Visa®, since it has some of the best features of any secured card. This card requires a small $35 annual fee and features no penalty APR, no foreign transaction fee, and super-low 4% APR during deployment or PCS. All of these features make the USAA Secured Card® Platinum Visa® a valuable resource to servicemen and women as well as their families.

How to use it
  • Put down a security deposit of $250 to $5,000 in the form of an interest-earning CD. The amount you put down will be equal to your credit limit.
  • Pay your balance in full and on time each month to build your credit and avoid paying interest. There’s no penalty APR, but late payments can carry a fee of up to $35.
  • Take advantage of $0 foreign transaction fees during international trips.
  • Leave the CD untouched for two years to avoid penalties for early withdrawal.
Consider this

Keep in mind that if you don’t want to face an early-withdrawal penalty, you’ll need to keep your security deposit as a CD for two years. For a card that offers the chance to get your security deposit back sooner, consider the Discover it® Secured Card - No Annual Fee.

Why you'll love it

The USAA Secured Card® Platinum Visa® is one of the best secured credit cards for military personnel and their families. This card has very favorable terms, and while there may not be a rewards program, it has a number of military-friendly perks that you’ll want to take advantage of as a cardholder.

Start your application now

Best for low fees

Capital One® Secured Mastercard®
Security deposit $49, $99, or $200 based on creditworthiness
Reward details None

Free monthly credit score Available
Annual Fee $0
Highlights Provided by Capital One Show Highlights
  • No annual fee, and all the credit building benefits with responsible card use
  • Unlike a prepaid card, it builds credit when used responsibly, with regular reporting to the 3 major credit bureaus
  • You will get an initial $200 credit line after making a security deposit of $49, $99, or $200, determined based on your creditworthiness
  • Get access to a higher credit line after making your first 5 monthly payments on time with no additional deposit needed
  • Easily manage your account 24/7 with online access, by phone or using our mobile app
  • It's a credit card accepted at millions of locations worldwide
  • Issuer: Capital One
  • Rewards Details: N/A
  • Annual Fee: $0
  • Balance Transfer Fee: $0
  • Cash Advance APR: 24.99% (Variable)
  • Foreign Transaction Fee: None
  • Introductory APR: N/A
  • Introductory APR Period: N/A
  • Introductory Balance Transfer APR: N/A
  • Introductory Balance Transfer Period: N/A
  • Ongoing APR: 24.99% (Variable)
  • Penalty APR: None

Our two cents

Who should get it

Anyone just starting out rebuilding their credit should consider the Capital One® Secured MasterCard®. One great feature is that you don’t have to tie up too much in a security deposit. You can put down as little as $49, $99, or $200 to get a $200 credit line (depending on your creditworthiness). You can also choose to deposit more money to get a higher line of credit, and/or access a higher credit line after five months of making monthly payments on time. Other perks include no annual fee, no penalty APR, no foreign transaction fees, and access to Credit One’s CreditWise for credit score monitoring and other tools.

How to use it
  • Put down more than the minimum security deposit to score a larger credit limit (up to $1,000).
  • Pay your first five monthly payments on time to get access to a higher line of credit – no additional funds needed.
  • Pay your balance in full and on time each month to build your credit, avoid paying interest, and possibly receive a deposit refund.
  • Take advantage of $0 foreign transaction fees during international trips.
  • Use Capital One’s CreditWise tool to access your credit score and keep an eye on your credit profile as you rebuild your credit.
Consider this

The card does have a higher interest rate at 24.99% variable APR, which also applies to cash advance and balance transfers. Be sure to pay your balance in full and on time each month to avoid paying interest. This will also help you rebuild your credit score, since on-time payments are a contributing factor.

Why you'll love it

The Capital One® Secured MasterCard® is a great starter card for rebuilding your credit, since there’s minimal upfront cost—no annual fee and a security deposit of as little as $49. Additionally, using the card responsibly by making payments in full and on time won’t just boost your credit, it can also help you qualify for a higher line of credit next time you apply for a card.

Start your application now

Best for moving to an unsecured card

U.S. Bank Secured Visa® Card
Security deposit $300 to $5,000
Reward details None. However, your security deposit will be placed in an interest-earning savings account.

Free monthly credit score Not available
Annual Fee $29
Highlights Provided by U.S. Bank Show Highlights
  • You are not responsible for unauthorized transactions if your U.S. Bank Secured Visa card is ever lost or stolen.
  • detects and notifies you of any unusual card activity to help prevent fraud.
  • It's yours automatically - at no extra cost - when you charge your entire car rental on your U.S. Bank Secured Visa Card and decline the rental company's collision damage waiver option. Coverage on a 24-hour basis for damage due to collision or theft.
  • The easiest way to bank online! With this service you can view current statements, download account history, check your balance, make a payment from your U.S. Bank Checking or Savings account, get a cash advance and much more.
  • Take advantage of this easy way to pay bills online.
  • U.S. Bank offers this online tool that can help you avoid interest and late fees with automatic payments that put you in control. It can also help you pay down a balance faster. Learn more at usbank.com/flexcontrol.
  • Issuer: U.S. Bank
  • Annual Fee: $29
  • Balance Transfer Fee: Either 3% of the amount of each transfer or $5 minimum, whichever is greater.
  • Cash Advance APR: 24.99%
  • Foreign Transaction Fee: 2% USD, 3% Foreign Currency
  • Ongoing APR: 19.99%
  • Penalty APR: Not applicable

Our two cents

Who should get it

Anyone who wants to go from secured to unsecured with just one card (and no extra hard inquiries) should consider the U.S. Bank Secured Visa® Card. With this card, you’ll have the opportunity to “upgrade” to an unsecured card after a year of responsible use. To start out, you’ll pay a small annual fee of just $29 and put down a security deposit, which will be placed into an interest-earning savings account (something that differentiates it from other secured cards). Pay your card off in full and on time each month for a year, and you can request a review of your account for a possible upgrade (and a refund of your security deposit).

How to use it
  • Put down a security deposit of $300 to $5,000. The amount you put down is the amount you have available in credit.
  • Pay your balance in full and on time each month to build your credit and avoid paying interest.
  • Use your card responsibly for 12 months to possibly “upgrade” to an unsecured credit card.
Consider this

The amount you put down in a security deposit is equal to your line of credit. So, if you want a higher line of credit, you’ll need to put more down than the minimum required deposit.

Why you'll love it

The U.S. Bank Secured Visa® Card offers a straightforward approach to building or establishing credit. By paying your balance in full and on time each month, you’ll not only boost your credit score, but also may be eligible for an account upgrade to an unsecured card within a year.

Start your application now

Best for low APR

First Progress Platinum Prestige MasterCard® Secured Credit Card
Security deposit $200 to $2,000
Reward details None

Free monthly credit score Not available
Annual Fee $49
Highlights Provided by Synovus Bank Show Highlights
  • Fund your new MasterCard® secured credit card with your tax refund today!
  • Our card reports monthly to all three major bureaus and approval is based upon a fully-refundable security deposit.
  • We can approve you at any credit score, no minimum required.
  • No processing or application fees required.
  • Full-featured Platinum MasterCard, accepted for car rentals, hotels, and millions of other locations worldwide.
  • Credit Line Secured by Your Fully-Refundable Deposit of $200 - $2,000 Submitted with Application
  • Nationwide Program though not yet available in NY, IA, AR, or WI
  • Issuer: Synovus Bank
  • Annual Fee: $49
  • Cash Advance APR: 18.99%, Variable
  • Foreign Transaction Fee: 3%
  • Ongoing APR: 9.99% (Variable)

Our two cents

Who should get it

Anyone who’s concerned they may sometimes need to carry a balance from month to month (we get it—things happen!), should consider the First Progress Platinum Prestige MasterCard® Secured Credit Card for their super low APR. When building your credit, it’s best to pay your balance off in full and on time each month (this also saves you on interest). However, if you do find yourself needing to carry a balance, you’ll benefit from a low APR of just 9.99% with this card instead of up to 30% with other cards. Keep in mind, you don’t want to carry a balance regularly. Use your card responsibly, and First Progress may review your account and approve a credit line increase of up to $5,000.

How to use it
  • Put down a security deposit of $200 to $2,000. The amount you put down is the amount you have available in credit.
  • Pay your balance in full and on time each month to build your credit and avoid paying interest.
  • Use your card responsibly to possibly receive a credit line increase of up to $5,000.
Consider this

If you’re disciplined about paying off your monthly balance in full and on time each month, then the low APR won’t make much difference. In that case, you might want to consider another card with no annual fee that also earns rewards, such as the Discover it® Secured Card - No Annual Fee.

Why you'll love it

Sometimes things happen. If you do need to carry a balance month to month, it’s good to know you won’t be faced with a high-interest rate. We can’t stress enough how important it is to pay your balance in full and on time each month. However, should something come up, you’ll feel better knowing you have a super low APR of 9.99% to fall back on with the First Progress Platinum Prestige MasterCard® Secured Credit Card.

Start your application now

The Simple Dollar’s top picks: summed up

What is a secured credit card?

A secured credit card requires you to deposit a certain amount of money in an account before you can use the card. Though it varies by company and by credit card, you may have to deposit an amount equal to your credit line. This money is used as collateral to protect the credit-card company in case you don’t pay your bills. Because there’s very little risk to the credit-card company, people with poor credit stand a much better chance of being approved for secured credit cards. Every card issuer will have different criteria, but applicants approved for several popular secured cards had average credit scores in the mid-500s, according to Credit Karma. Some successful applicants even had scores in the 400s.

What are the pros of secured credit cards?

Though they’re known as a “last resort” of sorts, secured credit cards have a number of advantages. These include:
  • Easier approval: If you’ve tried and failed to obtain an unsecured (or traditional) credit card, you know how frustrating that process can be. You’re much more likely to be approved for a secured credit card if you have bad credit or no credit.
  • A way to build or rebuild your credit: Your card issuer will probably report your account activity to the credit bureaus. Assuming you use the card responsibly, this will help you start to boost your credit score, which can affect everything from how cheaply you can borrow money to where you live and work.
  • A path to an unsecured credit card: Some credit-card companies will let you “graduate” to an unsecured card after you’ve used a secured credit card responsibly. You may not even need to reapply.
  • Built-in discipline: If you’ve had problems with overspending in the past, a secured credit card’s low limit will limit the damage you can do to your finances.

What are the cons of secured credit cards?

Of course, secured cards aren’t on the top of most credit-card wish lists because of their unique requirements and limitations, which include:
  • High interest rates and fees: In many cases, you will be paying a much higher APR than holders of unsecured cards — over 20% is not uncommon. Some secured cards also have higher-than-usual fees, which may include an annual fee as long as you have the card.
  • You have to come up with a deposit: If you’re strapped for cash, it may be tough to set aside a few hundred dollars for your secured credit card. You also risk losing the deposit if you fall behind on payments.
  • Low credit limit: Even if your credit-card issuer extends your credit limit beyond your deposit, it may be much lower than what you would get with an unsecured card and a better credit score. Though this can protect you from overspending, it also limits your spending power in case of emergency expenses.

How does a secured credit card stack up against a prepaid debit card or a personal loan?

You may be wondering why you would choose a secured credit card when a prepaid debit card would also give you the convenience of plastic without the hassle of applying for a credit card. After all, you still have to set aside your own money for the secured card’s deposit, so why bother? First, remember that you can actually raise your credit score with a secured credit card because the card issuer will report to credit bureaus. That’s a huge benefit if you’re committed to using your card responsibly, and one you won’t get by simply using a prepaid debit card. You may also boost your chances of getting an unsecured card with the same issuer. Second, there are fringe benefits to credit cards, even secured cards. Many cards have built-in perks such as purchase protection, which means your card issuer will reimburse you for certain items if they’re damaged or stolen within a certain period after purchase. Some may also extend manufacturers’ warranties. Your card may also insure you for certain travel expenses such as an interrupted trip or lost bag. These are advantages a prepaid debit card won’t give you. Finally, it may be easier to understand the fees associated with a secured credit card because they’re required by law to be disclosed in a certain way. You may not realize the full range of fees associated with a prepaid debit card because each company can present the information in different ways. Another way you can get funds with bad credit is by applying for a bad-credit personal loan. With bad credit, you’re typically going to be securing this loan with collateral that the bank can seize, such as your car, home, or other high-value possessions. You may be able to get a much larger loan than your credit limit on a secured card, and you won’t have to part with a big chunk of money as a deposit. However, your APR will probably be at least as high, if not higher, than what you can get on a secured credit card. If you miss payments, you also may risk losing collateral much more valuable than a few hundred bucks. If you do decide to look into a personal loan instead of a secured credit card, be sure to steer clear of predatory lenders. These include payday lenders, auto-title lenders, or any lenders who use high-pressure tactics to close a deal or guarantee that you can get a loan without checking your credit.

How to use a secured credit card responsibly

Credit-card companies risk little by issuing secured credit cards, but you risk making bad credit even worse if you don’t use the card responsibly. Here’s how to do that:
  • Avoid carrying a balance. This is particularly important with secured credit cards. That’s because your APR is likely to be fairly high. If you absolutely can’t afford to pay your whole balance, at least pay more than the minimum payment due to save on interest and show credit bureaus you’re serious about debt.
  • Don’t miss any payments. This is critical when you want to build your credit score, because your payment history — that is, whether you’ve paid your bills on time — determines 35% of your credit score. Missing payments can also mean you’ll have to pay a late fee on top of the payment you already owe, and your card issuer may hit you with a higher penalty interest rate, too.
  • Use your card every month. It may seem obvious, but to demonstrate responsible credit usage, you’ll actually have to use your credit card frequently. One easy way to do this is to pay a couple of consistent monthly bills with your credit card.

How to shop for the best secured credit card

If you’re convinced that a secured credit card will help you reach your financial goals, now it’s time to find the best one you for you. Here are five tips to keep in mind while you’re shopping:

Tip #1: Make sure your activity will be reported to the credit bureaus.

This is probably the most important thing to look for when you shop. If your credit-card issuer doesn’t report your account activity to the credit bureaus, you’ll be missing a huge opportunity to demonstrate financial responsibility and boost your credit score.

Tip #2: Look for a card with low fees.

It is more common to pay an annual fee with a secured credit card, but it should be reasonable — under $40 or so. Avoid cards that have an application fee; most reputable issuers won’t charge you to apply. Another fee to avoid is any sort of monthly account maintenance fee. And if a card issuer pushes you to buy any sort of insurance policy or other add-on to get approved, consider that a huge red flag and walk away.

Tip #3: Ask when you can be considered for an unsecured credit card.

Some credit-card companies will automatically review secured accounts after a certain period, such as a year. At that point, you may be offered the opportunity to convert your card into an unsecured credit card or apply for a new one.

Tip #4: Make sure you have a grace period.

Your grace period is the time between the end of each billing cycle and the date your payment is due. During that period, you can pay for what you’ve charged without paying any interest. Almost all cards have a grace period, but it’s always worth double-checking. If you do have a grace period, it’s legally required to be at least three weeks long.

Tip #5: Ignore rewards.

Most secured credit cards don’t offer much in the way of rewards, but if you find one that does, be careful. Rewards can tempt you to spend more than you should in an effort to obtain points or other perks. When you have a secured credit card, your only goal should be to show you’re a responsible user by charging a reasonable amount each month that you can pay off in full.

How I chose the best secured credit cards

To determine the best secured credit cards, I looked at the following criteria:
  • Credit-bureau reporting: I didn’t consider any card that doesn’t report your account activity to all three credit bureaus.
  • Credit limit: I looked for cards that allow you to build up to higher credit limits of at least $3,000. I also gave bonus points for cards that didn’t always require a dollar-for-dollar match between your deposit and credit limit, meaning you could potentially be approved for a limit greater than your deposit.
  • Unsecured card availability: I looked for companies that explicitly detailed a method or timeframe for secured-card holders to move up to an unsecured card.
  • Reasonable fees: It’s typical for secured credit cards to have an annual fee, but it shouldn’t be much more than $40. I also looked for cards without monthly maintenance fees or application fees, and gave bonus points to cards with no foreign transaction fees.
  • Reasonable APRs: While this would be one of the most important factors on any other credit-card list, it was a minor consideration for secured credit cards. That’s because APRs are generally high in this category, and using a secured credit card properly means you’ll be paying off your balance before you need to pay interest on purchases. However, bonus points went to cards with lower APRs for purchases and no penalty APRs.
  • An opportunity to earn interest: Some card issuers put your deposit in a savings account or CD that can earn interest while you have the card. While that’s unlikely to be a significant amount, it’s better than nothing.
  • A long grace period: Credit-card companies are not required to offer a grace period, but most do. I looked for cards that not only had a grace period, but a longer one than the required 21 days.
  • Additional perks and protections: I looked for cards with built-in features such as purchase protection, fraud protection, travel accident insurance, and extended warranties.

The best secured credit card can be a powerful financial tool.

Secured credit cards represent an opportunity to build or rebuild your credit. While you won’t have the lower APR, higher credit limit, and rewards that are common with unsecured cards, you probably won’t miss these perks if you use your card strategically and responsibly. For anyone with a military affiliation, we highly recommend the USAA Secured Card® American Express® Card and the USAA Secured Card® Platinum Visa®. Otherwise, you’ll want to identify what matters most to you in a secured credit card. If it’s low fees, try the Capital One® Secured MasterCard®; if you want a low APR, look at the First Progress Platinum Prestige MasterCard® Secured Credit Card. If you’re serious about quickly graduating to an unsecured credit card, consider the U.S. Bank Secured Visa® Card. If you want to learn more about your credit score, what affects it, and how it affects you, you’ll find everything you need to know in our credit score guide. And if you’re interested in other financial tools that may be available even if you have bad credit, we also offer guides to the best bad credit loans and bad credit auto loans.

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