A secured credit card is exactly like any other credit card, save for one thing: You have to place a refundable security deposit, the amount of which serves as your spending limit. When it comes to why a secured credit card is a great choice, there are five main reasons:
High Approval Odds – You can get approved for a secured credit card no matter how damaged your credit may be.
Low Costs – Secured cards tend to have very low fixed costs, thanks to their refundable security deposit. Just make sure to pay in full every month because they aren’t known for attractive APRs.
Credit Improvement – Secured cards are indistinguishable from unsecured cards. If you pay your bills on time each month and otherwise manage your account responsibly, your credit score will improve.
Budgeting – By making your spending limit equal to the amount of your security deposit, secured cards prevent you from borrowing more than you can afford to repay.
Convenience – A secured credit card will enable you to make purchases that cannot be completed with cash, such as car rentals, hotel bookings and online shopping. You’ll also benefit from the security of $0 fraud liability.
WalletHub Answers is a free service that helps consumers access financial information. Information on WalletHub Answers is provided “as is” and should not be considered financial, legal or investment advice. WalletHub is not a financial advisor, law firm, “lawyer referral service,” or a substitute for a financial advisor, attorney, or law firm. You may want to hire a professional before making any decision. WalletHub does not endorse any particular contributors and cannot guarantee the quality or reliability of any information posted. The helpfulness of a financial advisor's answer is not indicative of future advisor performance.
WalletHub members have a wealth of knowledge to share, and we encourage everyone to do so while respecting our content guidelines. Please keep in mind that editorial and user-generated content on this page is not reviewed or otherwise endorsed by any financial institution. In addition, it is not a financial institution’s responsibility to ensure all posts and questions are answered.
Ad Disclosure: Certain offers that appear on this site originate from paying advertisers, and this will be noted on an offer’s details page using the designation "Sponsored", where applicable. Advertising may impact how and where products appear on this site (including, for example, the order in which they appear). At WalletHub we try to present a wide array of offers, but our offers do not represent all financial services companies or products.