Low income doesn’t mean you can’t get a credit card. While some banks and credit unions may hesitate to approve your application based on income, don’t worry! There are independent credit card issuers out there who want your business and are willing to consider your application.
When you apply for a credit card, they ask about your income – it’s just something they must know by law. But don’t let that discourage you! Having a modest income doesn’t inherently disqualify you. Your income is just one of the factors they consider when deciding if you can handle the card responsibly.
Yes, it might be a bit more challenging to get a new credit card if you have a low income and some debt payments, but it’s not impossible. There are credit cards specifically designed for people in your situation, and with smart financial management, you can still qualify for a card that’s perfect for you.
Now, once your application is approved, the credit card company uses your income to figure out your credit limit – that’s the maximum amount you can spend with the card. Usually, lower incomes come with lower credit limits, but that’s okay. The key is to find a credit card that fits your needs and helps you build a positive credit history.
Check out the top credit card options, so you can take control of your finances and reach your financial goals, regardless of your income level. You’ve got this!
Best Credit Cards for Low Income
- Blue Cash Everyday® Card from American Express
- Petal® 2 “Cash Back, No Fees” Visa® Credit Card
- Bank of America® Travel Rewards credit card
- Citi Custom Cash℠ Card
- Surge® Platinum Mastercard®
1. Blue Cash Everyday® Card from American Express
9.8/10
Thanks to its generous cashback rewards program, the Blue Cash Everyday® Card from American Express could be an excellent choice if you have low income but have an existing relationship with Amex. With this card, you can earn cashback on everyday purchases such as groceries, gas, and even streaming services. Plus, there is no annual fee, which is great news if you’re on a tight budget.
Pros
- Offers a robust rewards program, giving 3% cash back at U.S. supermarkets (up to $6,000/year), 2% cash back at U.S. gas stations and select department stores, and 1% cash back on all other purchases.
- Gives the advantage of no annual fee.
- Welcomes you with a $200 statement credit.
- Provides the flexibility of 0% intro APR on purchases for the first 15 months.
Cons
- Requires good to excellent credit for approval.
- Limits cashback to certain categories, such as supermarkets, gas stations, and department stores.
- Charges a foreign transaction fee of 2.7%.
- Annual Fee: None
- Welcome Offer: $200 statement credit after spending $2,000 in the first six months.
- Rewards Program: Earn 3% cash back on the first $6,000 spent at U.S. supermarkets per year, 2% cash back at U.S. gas stations and department stores, and 1% cash back on all other purchases.
- Intro APR: 0% intro APR on purchases for the first 15 months.
- Regular APR: Variable APR between 13.99% – 23.99%
- Foreign Transaction Fee: 2.7% of each transaction after conversion to US dollars.
- Eligibility Criteria: Good to excellent credit score required.
2. . Petal® 2 "Cash Back, No Fees" Visa® Credit Card
9.5/10
The Petal® 2 “Cash Back, No Fees” Visa® Credit Card is tailor-made for you with limited credit history or low income. It’s an excellent option if you’re looking to build or rebuild your credit score while enjoying cashback rewards.
One of the standout features is its unique underwriting process, which considers factors such as income, savings, and bill payment history instead of relying solely on your credit score. With responsible usage, you can gradually increase your credit limit, empowering you to manage your finances more effectively.
Pros
- Comes with no annual fee or foreign transaction fees.
- Earns up to 1.5% cash back on every purchase, increasing to 1.25% after six on-time payments.
- Helps build credit history.
- Imposes no additional fees such as late fees, international fees, or any other fees.
- Offers a cashback rewards program.
- Requires no credit history for approval.
- Allows credit limit increases over time.
- Provides a mobile app for easy account management.
Cons
- May have limited acceptance compared to major credit card issuers.
- Could have higher interest rates if you have limited credit history.
- Annual Fee: $0
- APR: Variable APR between 12.99% – 26.99%
- Credit Needed: Limited / No Credit History
- Foreign Transaction Fee: None
3. Bank of America® Travel Rewards credit card
9.4/10
If you’re a low-income individual who loves to travel or dreams of exploring new destinations, the Bank of America® Travel Rewards credit card is your ideal companion. This card allows you to earn unlimited 1.5 points for every dollar spent on purchases, which can be redeemed for statement credits towards travel expenses, such as flights, hotels, rental cars, and more. Moreover, you’ll enjoy a fantastic 0% introductory APR on purchases for the first 12 billing cycles, enabling you to make big-ticket purchases without worrying about interest charges.
Pros
- Allows you to earn unlimited 1.5 points for every dollar spent on all purchases.
- Comes with no annual fee.
- Imposes no foreign transaction fees.
- Offers flexible redemption options for travel expenses.
- Provides an introductory 0% APR on purchases for the first 12 billing cycles.
Cons
- Limited travel benefits compared to premium travel cards.
- Annual Fee: $0
- APR: 0% Introductory APR for 12 billing cycles, followed by a variable APR of 13.99% – 23.99%
- Credit Needed: Good to Excellent
- Foreign Transaction Fee: None
4. Citi Custom Cash℠ Card
9.2/10
This card offers generous cashback rewards in categories that change automatically based on your spending patterns, allowing you to maximize your savings. It also has no annual fee, making it a budget-friendly option.
Pros
- Earns 5% cash back on eligible purchases in your top spending category each billing cycle.
- Earns 1% cash back on all other purchases.
- Comes with no annual fee.
- Offers 0% introductory APR on purchases and balance transfers for the first 15 months.
- Automatically categorizes spending for maximum rewards.
Cons
- Requires good to excellent credit for approval.
- Limits cashback to specific categories
- Annual Fee: $0
- APR: 0% Introductory APR for 15 months on purchases and balance transfers, followed by a variable APR of 13.99% – 23.99%.
- Credit Needed: Good to Excellent
- Foreign Transaction Fee: 3% of each purchase transaction in U.S. dollars.
5. Surge® Platinum Mastercard®
9/10
This card is for individuals like you with less-than-perfect credit and offers the opportunity to improve your credit score through responsible card usage. It also provides a credit limit increase after 6 months of on-time payments.
Pros
- Provides an opportunity to build or rebuild credit.
- Offers credit limit increases with responsible use.
- Requires no security deposit.
- Specifically designed for individuals with limited or poor credit history.
- Allows easy online account access for management.
Cons
- Lacks cashback rewards or significant perks.
- May have a high APR.
- Incurs annual and processing fees.
- Initial credit limit: $300 to $1,000.
- Credit-building potential: Reports to major credit bureaus.
- Acceptance: Use it wherever Mastercard is accepted.
- Mastercard Zero Liability Protection: Safeguard against unauthorized charges.
- Monthly credit score: Access your free credit score with e-statements
- Credit Needed: Poor to Fair
Overview of Best Credit Cards for Low Income
The best credit cards for low-income individuals like you include the Blue Cash Everyday® Card from American Express, which offers generous cashback rewards and no annual fee; the Petal® 2 “Cash Back, No Fees” Visa® Credit Card, ideal for building credit history without fees; the Bank of America® Travel Rewards credit card, providing unlimited points for travel expenses and no foreign transaction fees; the Citi Custom Cash℠ Card, offering straightforward 5% cash back on top spending category each month; and the Surge® Platinum Mastercard®, for credit-building with no security deposit and a flexible initial credit limit.
These cards cater to various needs, empowering you to manage finances efficiently while enjoying perks that suit your lifestyle.
How to Choose the Best Credit Cards for Low Income
- Assess Your Financial Situation: Start by understanding your current financial standing, including your income, expenses, and outstanding debts. This helps you determine how much credit you can comfortably handle.
- Look for Low or No Annual Fees: To keep costs down, opt for credit cards with low or no annual fees. This way, you can enjoy the benefits of a credit card without incurring unnecessary expenses.
- Consider Secured Credit Cards: Secured credit cards can be an excellent option if you’re a low-income earner. They require a refundable security deposit, which typically becomes your credit limit. These cards are easier to qualify for and can help you establish or rebuild your credit.
- Review Rewards and Benefits: While low-income credit cards may not offer extravagant rewards, look for ones that provide cash back or other incentives on everyday purchases. These rewards can add up over time and provide some financial relief.
- Check for Introductory APR Offers: Some credit cards offer introductory 0% APR periods for balance transfers or purchases. This feature can be beneficial if you need to manage existing debt or plan to make a significant purchase.
Pros & Cons of Best Credit Cards for Low Income
- Pros
- Offers an opportunity to access credit and build or rebuild your credit history.
- Gives the potential to earn cash back or rewards on essential purchases with some cards.
- Serves as a stepping stone to qualifying for better credit cards in the future.
- Helps improve financial responsibility when used wisely.
- Cons
- Provides lower credit limits compared to cards offered to higher-income individuals.
- Limits or denies access to premium benefits and rewards.
- May come with higher interest rates in some cases.
- Poses a potential risk of accumulating debt if not used responsibly.
What to Watch Out For
- High-interest rates: Low-income credit cards may come with higher APRs, so make sure to pay off your balance in full each month to avoid unnecessary interest charges.
- Hidden Fees: Read the fine print and be wary of hidden fees, such as late payment fees or penalties for exceeding your credit limit.
- Credit Utilization: Keep an eye on your credit utilization ratio – the amount of credit you’re using compared to your credit limit. Aim to keep it below 30% to maintain a healthy credit score.
Pro Tips
- Be punctual with your credit card payments to avoid late fees and protect your credit score.
- Start with a credit card suitable for your income and financial status, gradually accessing better options.
- Stay vigilant by monitoring your credit report and score regularly for progress tracking and error detection.
Recap
Choosing the right credit card that suits your low income requires careful thought about your financial situation and what you need.
The top cards highlighted are the Blue Cash Everyday® Card from American Express, providing robust cashback rewards and a welcome offer without an annual fee; the Petal® 2 “Cash Back, No Fees” Visa® Credit Card, designed for building credit history and offering cashback rewards with no fees; the Bank of America® Travel Rewards credit card, granting unlimited points for travel expenses and no foreign transaction fees; the Citi Custom Cash℠ Card, offering 5% cash back on top spending category each month and no annual fee; and the Surge® Platinum Mastercard®, especially for credit-building with no security deposit and a flexible initial credit limit.
As you make your decision, keep in mind to look for credit cards with low fees, consider secured options if needed, and choose rewards that match your lifestyle. By using your credit card wisely and making timely payments, you’ll be well on your way to building a positive credit history and securing a brighter financial future for yourself.
No Comment! Be the first one.