Credit Cards for Teenagers

The best way to build credit at 18 is to get a credit card in your name and use it responsibly. All major credit cards report account information to the credit bureaus each month, allowing you to build credit history. As long as the information shows on-time payments and reasonable credit utilization, that credit history will be positive and you’ll be on your way to building a good credit score.

There are two ways to get a credit card at 18: as an authorized user or by applying for your own account. If you have enough independent income to afford monthly bill payments, you can get your own credit card account when you turn 18. The best type of credit card to get at 18 is a student credit card, assuming you’re in college. Credit cards for students tend to have better rewards as well as lower rates and fees than other starter credit cards for people with no credit.

But any type of card will do, provided it has a low annual fee and you use it right. To help you with that, we’ll lay out the recipe for building credit at 18 below.

Here’s How to Build Credit at 18 Years Old:

1. Become an authorized user on a family member’s credit card.
2. Apply for a starter credit card.
3. Set up automatic payments from a bank account for your starter card.
4. Make sure your card’s monthly statement balance is much lower than the credit limit.
5. Work toward a high-paying job.
6. Save as much as possible and minimize debt.
7. Monitor your credit and make adjustments when needed.

Using a credit card isn’t the only way to build credit at 18. One alternative is taking out a credit-builder loan, which is essentially a loan that holds the borrowed money in a bank account while you make payments. This allows you to build credit easily, and doesn’t require a good credit score. Once you’ve made all of the payments, the money is released to you. Credit builder loans are typically small (think around $1,000) and have short repayment times, usually just a year, so their sole intent is to help you build your credit.

Financing a car using an auto loan can also help you build credit. Just like any other loan, payments you make are reported to the credit bureaus. Getting an auto loan can also help your credit because a portion of your score is determined by your “credit mix,” so having an installment loan adds variety even once you have a credit card.

You can also arrange to have apartment rental payments reported to the credit bureaus. Some landlords report monthly rental payments to the credit bureaus automatically, but not all do. If your landlord doesn’t, you can still have your rental payments reported through a third-party service. Some of the top ones are RentTrack, eRentPayment, and Cozy. Paying rent is something you’d have to do each month anyway, so you might as well use it to build your credit, too.

Still, getting a starter credit card and/or becoming an authorized user on a family member’s or friend’s account is the best approach. Just remember that having your own account requires more responsibility, as you’ll be the one who has to pay the bills. If you don’t, your credit score will suffer. As an authorized user, bill payments are the primary accountholder’s responsibility. Because of that, authorized users can file a dispute with the credit bureaus to get negative information removed from their credit reports.

You can keep track of what’s on your TransUnion credit report and check your latest credit score for free on WalletHub. You’ll get personalized tips for how to build credit most efficiently, too.

You can get credit cards for kids by making them authorized users on your credit card account. A child legally cannot get their own independent credit card account until they turn 18 years old, but making your child an authorized user on your credit card can help them get a head start on building their credit history. Some credit card companies have minimum age limits for authorized users, but most credit card companies do not.

When a primary cardholder pays the bill on time and maintains low credit utilization, any authorized users on the account benefit from it. An authorized user doesn’t even have to use the credit card to reap the benefits. Also, some card issuers allow primary cardholders to set spending limits for each authorized user, which could come in handy if you’re giving a credit card to a child.

That said, if you’re trying to teach your kids about budgeting in a more hands-on way, you may also consider letting them use a prepaid or reloadable debit card designed for kids. These prepaid cards - one example is the Greenlight Card - allow parents to load money onto the card from an app and closely monitor their kids’ transactions. The big downside to a prepaid card for kids is that it does not build their credit history, because it’s not a credit card.

You can’t get a credit card at 16, at least not your own account. The law prohibits issuers from offering credit cards to anyone under 18. And even then, you’ll need your own income to qualify. These restrictions prevent minors and young adults from taking on unmanageable amounts of debt due to inexperience or youthful impulsiveness.

But you can get a credit card at 16 if a friend or family member makes you an authorized user on their account. You won’t be responsible for bill payments as an authorized user, but you will build credit as long as the primary cardholder pays on time. That’s not the only way to get access to credit in your teens, either.

Here are the alternatives to getting a credit card at 16:

• Become an authorized user: There’s no minimum age requirement for authorized users.
• Get a job and wait two years: You can get your own credit card account when you’re 18, as long as you have enough independent income for monthly bill payments. You should get a student credit card if you go to college, as they tend to have much better terms than other starter credit cards. A secured credit card is a good backup plan, too.
• Get a debit card: This won’t help you build credit, and you won’t be able to borrow money. But a debit card linked to your checking account will free you from having to carry cash all the time.

You can get a credit card at 16. You just can’t get an account in your own name. But if someone is willing to add you as an authorized user, you can start learning about, using and building credit. And in a couple years, you’ll be able to get your first card.

You can get a credit card at 17 as an authorized user, but you have to be at least 18 years old to open a credit card account in your own name. And when you turn 18, you’ll need to show that you have your own independent income to qualify. In the meantime, you can begin to build credit as an authorized user, and you can always use a debit card for everyday purchases.

Here’s what you can get instead of a credit card at 17:

• Authorized user card: If someone makes you an authorized user on their card, the account will be added to your credit report. And if the main accountholder pays the monthly bills on time, your credit score will improve. The main accountholder may or may not decide to give you a card that you can use to charge purchases to the account. But you won’t be responsible for making payments either way.
• Debit card: Most banks will give you a debit card connected to your checking account. You’ll be spending your own cash, not borrowing money, so you don’t need to be 18 to get one. Different banks have different rules, but most require you to be 13 or 14 years old. You won’t build credit with a debit card, but having one can make life more convenient until you turn 18.

So to recap, you can’t get a credit card at 17, at least not one of your own. But if you find someone to back you, then you can start building credit right away. And in just a year, you’ll be eligible for student credit cards, secured credit cards and other options for people new to credit.

The best credit card for 18-year-olds is the Petal® 2 Visa® Credit Card because it has a $0 annual fee and is intended for beginners with little-to-no credit history. The Petal 2 Card also rewards cardholders with up to 1.5% cash back on purchases. There’s no security deposit required to open the account, either.

Best Credit Cards for 18-Year-Olds

• Best Overall: Petal® 2 Visa® Credit Card
• Best for No Annual Fee: Capital One Platinum Credit Card
• Best for Students: Bank of America® Customized Cash Rewards Credit Card for Students
• Best for Gas Station and Restaurant Purchases: Discover it® Student chrome
• Best for a Low Deposit: Secured Mastercard® from Capital One
• Best for Bad Credit: Discover it® Secured Credit Card
• Best for Good Credit: Chase Freedom Unlimited®

As you can see, the best card depends a lot on your financial situation and spending habits. For example, the best credit cards for 18-year-old students are the Discover it® Student chrome and Bank of America® Customized Cash Rewards Credit Card for Students cards. They both offer $0 annual fees and solid cash back rewards on all purchases. A student’s age and earning potential are an attractive prospect for credit card issuers, so they’re willing to extend offers not readily available to non-students.

In addition, some of the other best credit cards for 18-year-olds are secured credit cards, which offer the easiest approval. They require a security deposit, typically around $200. The security deposit sets the credit limit and serves as collateral for the lender. It’s fully refundable after closing the account in good standing. The Discover it® Secured Credit Card and Secured Mastercard® from Capital One are two of the best secured credit cards for 18-year-olds.

Best Ways for 18-Year-Olds to Access Credit

Keep in mind that the Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009 places limits on credit cards for 18-year-olds. Under the law, consumers younger than 21 years old must have either a co-signer or proof of a steady income to be a credit card’s primary accountholder. If you can meet one of these two requirements, you’ll have a pool of cards to choose from that will help you establish credit.

Another option is to become an authorized user on someone else’s credit card. You can become an authorized user on any type of credit card, and you’ll enjoy any benefits the card offers while you establish your credit. The primary cardholder is financially responsible for the account, and his or her card activity will also be reflected on your credit report. However, any negative information such as late or missed payments will cause a drop in both of your credit scores.

You had to be at least 14 years old to get the DFCU Student Visa Platinum Card, but only as an authorized user on a Michigan resident’s account, per Michigan (and federal) law. This card, though, is not available anymore.

You need to be at least 18 years old to apply for your own credit card account. And since the Credit CARD Act of 2009, applicants under the age of 21 must have independently verifiable income (i.e. not a parent’s income) or a cosigner with sufficient income. The cosigner, who must be 21 or older, would share responsibility for any debt incurred on the card.

Teenagers under 18 who were added as authorized users for the DFCU Student Visa Platinum Card would share a credit limit with the primary cardholder. Past 18 years old, you could get a limit up to $2,000, so long as you had qualifying independent income. The DFCU website stated that teenagers ages 14-17 could be approved for this card with a co-signer, but this was incorrect. A teenager may only have a credit card as an authorized user on someone else’s account until they turn 18.

You can build your credit at 19 by becoming an authorized user on someone else’s credit card account or by getting your own credit card. You can get your own credit card when you turn 18 as long as you have an independent source of income. You can also build credit without a credit card by getting a loan – student loans, auto loans, and most other types of loans will help build your credit if you make your payments on time. You can also get a credit builder loan, which is designed for people with limited or bad credit.

If you don’t have income, the easiest way to start building credit at 19 is by becoming an authorized user on someone else’s account. This doesn’t require a credit check or independent income. Authorized users are not responsible for paying the credit card bill. But if the primary cardholder pays the bill on time and uses the credit card responsibly, any authorized users on the account will build credit history.

Getting your own credit card at 19 will require independent income, as you can’t use someone else’s income that you have reasonable access to (i.e. a parent or spouse’s income) on a credit application until you turn 21. Building credit at 19 is a good idea, but limited credit history could bar you from getting approved for some credit cards on your own. That said, there are plenty of starter credit cards and student credit cards that will increase your approval odds as someone with a thin credit file. Secured credit cards are another great choice.

Taking out a loan can also help build your credit, if you qualify for one. There are lots of types of loans out there, and they all require you to either provide proof of income or have someone else cosign for the loan. Getting approved for an auto loan, a student loan, or a personal loan will build your credit. Credit builder loans are upside-down loans, where you make payments to a lender in order to get the amount of the loan back when it’s paid off. These are generally offered by smaller banks, credit unions, and online lenders. No matter which loan you get, good information will be reported to credit bureaus every month as long as you pay on time.

However, building credit isn’t just about finding a financial institution that’s willing to extend you a loan or line of credit with your limited credit history. It’s also about managing your credit well. Those just starting out in the realm of credit cards should take time to learn the basics of building credit. A credit card won’t get you very far if you don’t know how to use it properly. And using credit properly – keeping your balance low and paying at least the minimum payment on time – is what eventually produces an excellent credit score.

No, you can’t get a credit card at 15. You won’t be able to get one in your own name until you’re 18. And even then, you might need to start out with a secured card until you’ve built up your credit history. The law prohibits minors from getting credit cards and requires anyone under 21 to show that they have their own income when they apply for a card.

But just because you can’t get your own credit card account doesn’t mean you have no options. Your best bet is becoming an authorized user on someone else’s card. Authorized users can charge purchases to the primary cardholder’s credit account, but they don’t have any legal responsibility for payment. And as long as the primary cardholder makes payments on time, the authorized user gets positive information on their credit report.

There are other ways to build credit without a credit card, like making rent payments, but they aren’t available to most 15-year-olds.  And if you want a credit card because carrying cash all the time is a hassle, many banks allow teenagers to open checking accounts with debit cards. Debit cards draw on the money in your checking account, so you don’t have to borrow money to use them. Prepaid cards (reloadable) and gift cards (usable until balance runs out) are other good spending tools.

So instead of getting a credit card at 15, it’s probably best to focus on becoming an authorized user, getting a debit card or both.

The best teen prepaid debit card is the American Express Bluebird Prepaid Card because it does not charge activation fees, in-network ATM fees, or monthly fees. Prepaid cards are not actually credit cards, though. There is no credit line associated with prepaid cards, and they do not affect your credit standing. The closest you’ll find to a prepaid credit card is a secured credit card.

The Bluebird Card Welcome Kit ($5) can be found at over 4,500 Walmart locations. It includes a temporary card that you can add funds to at checkout, then use immediately. To get your permanent card, register online or via the Bluebird app. Or, you can skip the kit and sign up for free on the Bluebird website, or download the mobile app to register there. You’ll then receive your Bluebird card in the mail within 7-10 business days. Most account services can be done online or via the Bluebird mobile app, rather than by going to Walmart.

It’s relatively uncommon for prepaid cards to have no major fees. But like most prepaid cards, there aren’t any rewards with Bluebird. And like all prepaid cards, teens under 18 will need the help of a legal adult to obtain a Bluebird card. An adult must first open a regular Bluebird account, then establish a Bluebird Family Account for the minor. You must be 13 years old to have a card tied to a Bluebird Family Account.

Just remember that this is an American Express card, which means it isn’t accepted everywhere. If a teenager is on a road trip and running out of gas, it would be unfortunate if the next gas station didn’t accept Amex. Other prepaid card options without this limitation include the Emerald Prepaid Card and the Western Union NetSpend Card. Both are Mastercards, and neither has monthly fees or activation fees. They do both charge for ATM use, however.

Teens 18 years or older who are looking to build credit should instead consider a secured credit card or a student credit card, both of which report to credit bureaus. Teenagers under 18 years old aren’t legally allowed to open their credit card accounts, and will need to be added to an adult’s account as an authorized user.

You can get a credit card at 14 as an authorized user, but you have to be at least 18 years old to open a credit card account in your own name. When you turn 18 years old, you’ll also need to show that you have your own independent income in order to qualify for your first credit card account. In the meantime, you can begin to build credit as an authorized user, and you can always use a debit card for everyday purchases.

Most 14-year-old authorized users won’t have much of a choice when it comes to which card they use, but if a young person’s parents happen to have one of the following credit cards, the arrangement could lead to outsized savings.

Best Credit Cards for 14-Year-Old Authorized Users

• Chase Freedom Unlimited® – Best for No Annual Fee
• Chase Sapphire Preferred® Card – Best Initial Bonus
• Citi® Double Cash Card – 18 month BT offer – Best for Cash Back
• Capital One Venture Rewards Credit Card – Best for Travel
• Petal® 2 Visa® Credit Card – Best for Limited Credit

So, to recap, you can’t get a credit card at 14, at least not one of your own. But if you find someone to back you, then you can start building credit right away. And in just four years, you’ll be eligible for student credit cards, secured credit cards and other options for people new to credit.