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While we often discuss the world’s best credit cards with $450 per year annual fees and incredible perks on this blog, there is a large group of people who are just starting out and need to aim slightly lower as they build their credit scores. I happen to be one of these people, along with most other teenagers and college students.
Just one month after my 18th birthday, I knew it was time to begin my slow journey towards a wallet stacked with rewarding credit cards. I was dying to get my hands on some of the perks offered to those with high credit scores. The only problem was that I had no credit history.
While visiting my uncle in San Diego, we went to his local strip mall where all the major banks had offices (apart from American Express, of course). Unsurprisingly, most told me I wasn’t eligible for any of their current cards. Finally, the manager at Capital One suggested I get a secured credit card to start out.
Sure enough, I applied for a card and was soon the proud owner of what was probably the most boring credit card on the market, but at least I had one.
I initially had a credit limit of $200, the same amount I had to deposit into my secured account. Five months later, it was increased to $500.
Where to go from here?
My card was a lot of fun and all, but I was thirsting for a good sign-up bonus and a better return on my spend. Two months later, I got what I was looking for. The SPG American Express had an increased sign-up bonus of 35,000 Starpoints, for which I was instantly approved. It was an exciting time since I would now earn the equivalent of 2.2% cash back on all my purchases per Ben’s recent valuation of Starpoints. I’ve loved the card ever since, especially the versatility of the points currency, but my one doubt has always been the $95 annual fee.
I’m still thrilled I got approved for a card of that caliber with so little history (I was 18 at the time), so it could be a great option for anyone with a weak/moderate credit score looking for generous returns. Right now the sign-up offer is two free nights at any Starwood hotel, worth up to 32,000 Starpoints — a good deal in my opinion. The Free Night Award stays even count toward elite qualification!
This brings me to my current situation; last month I was browsing the American Express website in search of another card to add to my small collection. Given that my last approval was in March, I figured my odds of getting approved for another card were good at this point. The Premier Rewards Gold Card was appealing, but I didn’t want to be stuck with another annual fee ($195) while trying to build my credit score.
Among the slightly lower-end credit cards that still had decent sign-up bonuses, I found myself choosing between the Amex Everyday and the Amex Everyday Preferred. While the latter has slightly better returns, it has a $95 annual fee and the sign-up bonus only differs by 5,000 Membership Rewards points. Given that the age of my accounts is of utmost importance at these early stages, I decided I was better off choosing a card with no annual fee that I could hold on to in the long run.
I applied to the Amex Everyday with a 15,000 point sign-up bonus upon spending a mere $1,000 in 90 days and was instantly approved. YAY!
The card was delivered a week later and I’ve already reach the minimum spend. Receiving 15,000 Membership Rewards points is incredible for a no-annual fee card. Ben values Membership Rewards points at 1.7 cents each, meaning the sign-up bonus is worth $255. I’m planning on transferring them to Singapore Airlines to redeem toward their A380 Suite Class soon. The card will be great for my long term credit score since I can hold on to it forever at no cost. It also offers two points per dollar at U.S. supermarkets and a 20% points bonus when you make 20 or more purchases per billing cycle.
American Express has some of the easiest credit cards to get approved for with a limited credit history. My credit age was only seven months when I got approved for my Starwood Preferred Guest Amex and now I was approved for yet another card six months later. In hindsight, I would have applied to the Amex Everyday Card first and really tried to get it as early as possible for the sake of my credit score. Between the $0 annual fee, the 15,000 point sign-up bonus (which is generous compared to other no-annual fee cards), and the possible 1.2%+ return on everyday spend, this card is a no-brainer for those looking to build their credit score and earn points.