Guide
How to Build Credit From Scratch With Your First Credit Card
A step-by-step plan to build a credit score from nothing: which card to start with, the habits that move your score, and how long it takes.
Why a credit card is the easiest way to start
A credit score is a summary of how you've handled borrowed money, and with no history there's nothing to summarize. A credit card is the simplest way to create that history: it reports to the credit bureaus every month whether or not you carry a balance, so a card you use lightly and pay in full builds credit without costing anything in interest.
Debit cards, rent and utilities generally don't count toward a standard credit score unless you sign up for a service that reports them.
Step 1: Pick a first card you can get
Secured cards ask for a deposit, often a few hundred dollars, that usually becomes your credit limit. You get it back when you close the card or the issuer upgrades you to a regular card. These are the top secured cards by what they earn while you build:
| Card | Annual fee | Earns a year (typical spending) |
|---|---|---|
| U.S. Bank Altitude Go Secured Visa Card | $0 | $545 |
| Bank of America Secured Travel Rewards Credit Card | $0 | $468 |
| Bank of America Unlimited Cash Rewards Secured Credit Card | $0 | $468 |
| Quicksilver Secured from Capital One | $0 | $468 |
| Bank of America Customized Cash Rewards Secured Credit Card | $0 | $372 |
| Discover it Secured Cash Back Credit Card | $0 | $312 |
The full list is on best secured credit cards. If you're a student, best student credit cards (led by the Bank of America Travel Rewards Credit Card for Students) usually need no deposit.
Before applying, check that the card reports to all three bureaus (Equifax, Experian and TransUnion) and has no annual fee. A starter card shouldn't cost money to hold.
Step 2: The habits that build your score
FICO publishes how its scores are weighted:
| Factor | Weight | What to do |
|---|---|---|
| Payment history | 35% | Pay at least the minimum on time, every month. Turn on autopay. |
| Amounts owed | 30% | Keep your statement balance low against your limit: under 30%, ideally under 10%. |
| Length of credit history | 15% | Keep your first card open, even if you later stop using it much. |
| New credit | 10% | Apply for new cards a few months apart, not all at once. |
| Credit mix | 10% | Don't take on a loan just for this; it matters least. |
The simplest routine: put one small recurring bill on the card, set autopay for the full statement balance, and don't touch it otherwise. You'll pay no interest and build history every month.
Step 3: How long it takes
Expect a first FICO score once your account has been open and reporting for about six months. With on-time payments and low balances, many people reach the "good" range (670+) within a year or two.
After 6 to 12 months of on-time payments, ask your issuer about graduating from a secured card to an unsecured one, which returns your deposit. Then you can move on to a card with better rewards, such as one from best no annual fee credit cards or a card with a long 0% intro APR like the U.S. Bank Shield Visa Credit Card.
Mistakes that set you back
- A late payment. A payment 30+ days late can stay on your report for seven years. Autopay prevents it.
- Maxing out the card. High utilization drags the score down even if you pay in full later.
- Applying everywhere at once. Each application is a hard inquiry, and denials don't help.
- Closing your first card. It's your oldest account; keep it open if it has no fee.
Questions people ask
How can I build credit with no credit history?
Open a secured or student credit card, use it for a small bill, and pay the full balance on time every month. After about six months of reporting you will have a FICO score.
How long does it take to build credit from scratch?
About six months for a first FICO score. With on-time payments and low balances, many people reach a good score (670+) within one to two years.
Does a secured card build credit like a regular card?
Yes. A secured card reports to the credit bureaus like any other card; the deposit just sets your limit. Check that the card reports to all three bureaus before applying.
What credit utilization should I keep?
Below 30% of your limit on your statement balance, and below 10% for the best scores. On a $500 limit, that means a statement balance under $50 to $150.