8 Best Secured Credit Cards of March 2025

For individuals that struggle with poor credit, a secured credit card can be a valuable tool. With a secured credit card, you’ll pay a cash deposit that’s equal to your credit line.

The credit card issuer will then hold on to your deposit in case you don’t make your monthly payments. Meanwhile, the credit card issuer will report your on-time payments to the major credit bureaus.

That way you can start rebuilding your credit, and there’s little risk to credit card issuers since you paid an upfront deposit. You’ll get your money back once you upgrade to an unsecured card or close the account.

8 Best Secured Credit Cards

If you’ve been looking for ways to improve your credit but have a hard time qualifying for unsecured cards, then a secured credit card might be the way to go. Here are some great secured credit cards for you to consider.

Pros & Cons of a Secured Credit Card

A secured credit card can be a useful tool for building or rebuilding credit, but it comes with trade-offs. Here’s what to consider before applying.

Pros

• Easier Approval: If you’ve been denied an unsecured credit card due to a low credit score, a secured card provides a way to establish or rebuild credit.
• Credit Building: On-time payments and responsible use can improve your credit score within months, helping you qualify for better financial products.
• Refundable Deposit: Your security deposit isn’t lost—it’s returned when you close the account in good standing or upgrade to an unsecured card.
• Upgrade Potential: Many secured cards allow you to transition to an unsecured card after proving responsible use, giving you access to better terms and rewards.

Cons

• Limited Rewards: While a few secured cards offer rewards, they’re generally not as competitive as those from unsecured cards.
• Requires a Deposit: A security deposit is mandatory, which can be a hurdle if cash is tight. Some cards offer lower deposit options to ease the burden.
• Possible Fees: Some secured cards charge annual, processing, or penalty fees. Choosing a low-fee option can save you money.
• Higher Interest Rates: These cards often have higher APRs, making it important to pay off the balance in full each month to avoid interest charges.

When is a secured credit card a good idea?

Secured credit cards might sound useful, but when exactly is it a good idea to get one? And are they suitable for anyone? Let’s take a look at some examples that are best suited to secured cards versus regular credit cards.

You Need to Build Credit from Scratch

Secured credit cards are designed primarily to help those with thin credit build a positive credit history. If you’ve never dealt with credit before, taking on a secured card is a smart way to build a history of timely payments.

Monthly payments are reported to the three major credit bureaus, meaning you can quickly build your credit history when your payments are on time.

You Need to Repair Bad Credit

When it comes to rebuilding bad or damaged credit, secured cards are also a great idea. With late payments on your credit report, it can be difficult, if not impossible, to open a new line of credit.

Secured cards may be one of your only remaining options for getting your credit history back on track. The good news is, they are a great tool for repairing credit as well as building it from scratch.

You Want to Avoid Debt While Building Credit

If increasing your credit score is important to you, but you don’t want to take on the risk of debt, a secured credit card can do the job. Secured cards are guaranteed by your deposit, plus credit limits are generally small. This can be a great option whether you’re looking to get out of debt, or simply trying to avoid getting in to debt in the first place.

How to Get a Secured Credit Card

Finding a secured credit card is easier than ever, with plenty of options available online and through major banks. The key is choosing one that fits your needs and using it to build credit effectively. Here’s how to get started.

Compare Your Options

Not all secured credit cards are the same. Some require high deposits, while others let you set your own limit. Look for:

• Low or no fees – Avoid cards with high annual or monthly fees.
• Credit bureau reporting – Make sure the card reports to all three major credit bureaus.
• Upgrade potential – Some cards automatically transition to an unsecured card after responsible use.

Determine Your Deposit

Most secured cards require a refundable deposit, which sets your credit limit. A higher deposit gives you more spending power but isn’t always necessary. If possible, aim for a deposit that keeps your credit utilization low—using less than 30% of your limit helps boost your credit score.

Apply for the Card

The application process is usually quick and can often be completed online. You’ll need to provide basic information, including your Social Security number and income details. Some cards don’t require a credit check, making them easier to qualify for.

Make Your Deposit and Activate Your Card

Once approved, you’ll need to fund the deposit before your card is issued. Most issuers allow bank transfers, debit card payments, or direct deposits. Once your card arrives, activate it and start using it for small, manageable purchases.

How to Maximize the Benefits of a Secured Credit Card

A secured credit card can help build or rebuild your credit, but its effectiveness depends on how you use it. Developing good habits now will set you up for success when transitioning to an unsecured card. Here’s how to get the most out of your secured credit card.

Always Pay on Time

Your payment history is the biggest factor in your credit score. Even one late payment can cause a drop, making it harder to qualify for better cards in the future.

• Set up automatic payments to ensure you never miss a due date.
• Use reminders through your bank or calendar app to stay on track.

Pay the Full Balance Each Month

Secured cards often come with high interest rates. Paying your full balance avoids unnecessary interest charges and keeps your credit utilization low, which helps boost your score.

Stick to a Budget

A secured credit card is a great tool for credit building, but overspending can hurt your progress.

• Plan purchases in advance to avoid unnecessary debt.
• Keep your balance as low as possible relative to your credit limit to show responsible use and improve your credit score.

Monitor Your Credit Score

Most secured cards provide access to free credit monitoring. Take advantage of this feature to:

• Track your progress and adjust your habits if needed.
• Check for errors or fraud on your credit report.

You’re also entitled to a free credit report from each bureau once a year at AnnualCreditReport.com.

Use Your Card Regularly

To build a strong credit history, you need to use your card. Even small, recurring charges—like a streaming subscription—can keep the account active and contribute to your score.

Upgrade to an Unsecured Card

After six to twelve months of responsible use, you may qualify for an unsecured credit card with better terms and rewards. Some secured cards automatically review your account for an upgrade, while others require you to apply.

See also: Secured vs. Unsecured Credit Cards: What’s the Difference?

By following these steps, you’ll not only improve your credit score but also develop solid financial habits that will serve you well in the long run.

Final Thoughts

A secured credit card can be a smart way to build or rebuild credit, especially if you have trouble qualifying for traditional credit cards. By making on-time payments, keeping your balance low, and monitoring your credit, you can improve your credit score over time. Many secured cards also offer a path to upgrading to an unsecured card, giving you access to better terms and rewards.

Before choosing a secured credit card, compare options to find one with low fees, credit bureau reporting, and upgrade potential. With the right strategy, a secured card can be a stepping stone to stronger credit and better financial opportunities.

Frequently Asked Questions

Can I have more than one secured credit card?

Yes, you can have multiple secured credit cards, but it’s usually better to focus on using one responsibly. Managing multiple cards increases the risk of missing payments and can tie up more of your money in security deposits. If your goal is to build credit, using one secured card responsibly is often enough.

Will closing a secured credit card hurt my credit score?

Closing a secured credit card can impact your credit score, especially if it was your oldest account or your only line of credit. It may lower your average account age and increase your credit utilization ratio. If you’re considering closing your card, try upgrading to an unsecured card with the same issuer instead.

Can I increase my secured credit card limit?

In most cases, you can increase your secured credit card limit by adding to your security deposit. Some issuers also offer credit limit increases based on responsible use without requiring an additional deposit. Check with your card issuer to see what options are available.

Do secured credit cards have rewards programs?

Some secured credit cards offer rewards, but they are less common than with unsecured cards. A few secured cards provide cash back or points on purchases, but the main benefit of a secured card is credit building. If rewards are a priority, look for a secured card that includes them.

What happens if I don’t pay my secured credit card bill?

If you don’t pay your secured credit card bill, the issuer will report missed payments to the credit bureaus, which can damage your credit score. While your deposit serves as collateral, the issuer may still send unpaid debts to collections. To avoid this, always make at least the minimum payment on time.