How Fast Will a Secured Card Build Credit?

While it’s impossible to say exactly how fast a secured card will build credit, the general rule of thumb is that the longer you use your new card responsibly, the better for your score. But the most important factor is always paying your statement balance in full by the due date, which counts for over one-third of your credit score. Aside from that, you’ll also want to avoid unnecessary hard inquiries and keep your balances below 30% of your total credit limit. These are all good practices that will help you gradually improve your credit health over time, leading to a higher credit score, which makes it easier for you to qualify for other cards with better terms and benefits.

Secured credit cards are usually a great first step for people who have no credit history or those with a poor credit score, as they’re virtually indistinguishable from unsecured cards and don’t require any collateral. They can be an especially helpful tool if you’ve had past financial hardships like bankruptcies or foreclosures that have damaged your credit.

If you’re shopping for a secured credit card, make sure to choose a brand that reports to the major credit bureaus (Experian, Equifax and TransUnion). Also, be sure to look for a card that offers a low credit limit, a low or no annual fee, purchase protection, and/or credit score monitoring. Finally, be sure to select a card that lets you check your chances of approval without a hard credit inquiry, as some cards may require you to pay a deposit right after you’re approved.

Once you’re a cardholder, spend responsibly and pay your balance in full by the due date each month. Aim to maintain a balance below 30% of your total credit limit and don’t carry a balance between months. If you do, it’s a good idea to pay the balance in full as soon as possible to prevent interest charges. And don’t forget to regularly check your credit report and score, which you can do for free at WalletHub, along with other tools that will help you track your progress.

Practicing these behaviors with a secured card will help you gradually build or rebuild a good credit score, which will then allow you to qualify for more standard cards that offer better terms. However, you’ll likely need a fair to good credit score, typically in the high 600s or above, to qualify for unsecured cards with lower fees and APRs. So if you’re working on raising your credit score, it may take some time before you see the rewards of your efforts, but it’s definitely worth the wait. After all, a good credit score can save you a lot of money in the long run. You can find more tips on improving your credit score in this WalletHub article. You can also sign up for a WalletHub account to get daily updates on your credit score and credit report, along with other tools that can help you figure out how to build or rebuild your credit score.