How to Get Your First Credit Card Under 21

It is possible for individuals under 21 to obtain their first credit card, a step that can be beneficial for establishing a credit history. Building credit early can pave the way for future financial endeavors, such as securing loans for a car or a home. While challenges exist for younger applicants, understanding requirements and options simplifies acquiring a credit card.

Key Regulations for Young Applicants

The ability of young adults to acquire credit cards is significantly shaped by the Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009. This federal legislation introduced protections for consumers, especially those under the age of 21, by requiring credit card issuers to assess an applicant’s ability to make payments.

Under the CARD Act, individuals aged 18 face specific restrictions when applying for a credit card. They must demonstrate either an independent means to repay the debt or have a cosigner who is at least 21 years old and has the financial capacity to take on the responsibility. These rules also limit credit card marketing practices targeting college students, prohibiting gifts or incentives for applying for cards on or near campus.

Qualifying Through Independent Income

For individuals under 21 seeking a credit card, demonstrating independent income is a primary method of qualification. This income must be verifiable and sufficient to indicate an ability to make credit card payments. Acceptable sources of independent income typically include wages from a job, whether part-time or full-time, and earnings from work-study programs.

Beyond traditional employment, other forms of financial support can also be considered. This includes regular allowances from family members, provided these funds are consistently deposited into the applicant’s bank account. Additionally, scholarships and grants can count as income, but generally only the portion that remains after tuition and required educational expenses have been paid. To substantiate reported income, applicants may need to provide documentation such as pay stubs, tax forms, or bank statements.

Qualifying With Support

When independent income is not sufficient, individuals under 21 have two main avenues for obtaining a credit card with external support: becoming an authorized user or applying with a cosigner. Each option carries distinct responsibilities and implications for credit building.

Becoming an authorized user involves being added to an existing credit card account by the primary cardholder. While authorized users receive their own card and can make purchases, they are not legally responsible for the debt incurred on the account; this responsibility remains solely with the primary cardholder. This arrangement can help an authorized user build credit history, as the primary account’s payment activity may be reported to credit bureaus, potentially impacting their credit score if managed responsibly. However, the primary cardholder assumes all financial risk, and negative activity on the account could also affect the authorized user’s credit.

Alternatively, applying with a cosigner means another individual, typically a parent or guardian, agrees to share full legal responsibility for the credit card debt. If the primary applicant fails to make payments, the cosigner is legally obligated to do so, and their credit history will also be affected by the account’s performance. While the CARD Act permits cosigners for applicants under 21, many major credit card issuers have reduced or eliminated cosigning options, making this pathway less common than it once was. Nevertheless, some local banks or credit unions might still offer credit cards with a cosigner option.

Selecting Your First Card and Applying

Choosing the right first credit card is an important decision that aligns with an individual’s financial situation and qualification method. Student credit cards are often suitable for those enrolled in higher education, typically offering features such as lower credit limits and sometimes rewards tailored to student spending. These cards may have more lenient approval requirements for those with limited credit history.

Secured credit cards present another viable option, particularly for individuals with no credit history or those who do not qualify for an unsecured card. With a secured card, a refundable security deposit, typically ranging from $200 to $2,500, serves as collateral and often determines the credit limit. This type of card allows cardholders to build credit by demonstrating responsible payment behavior, and with consistent on-time payments, it may eventually transition to an unsecured card.

When preparing a credit card application, accuracy is paramount. Applicants will need to provide personal details, including their full legal name, date of birth, and Social Security number. Employment status and gross annual income are also required.

If qualifying through independent income, the previously gathered documentation, such as pay stubs or bank statements, supports the income reported. For those relying on a cosigner, their information will also be necessary to complete the application. Most credit card applications can be submitted online, and applicants can expect an immediate decision or a pending review status after submission.