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.
To learn more, check out WalletHub’s secured credit card guide.
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