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Take control of your financial future with these top 5 cards for recent college grads

Recent college grads should consider one of these credit cards that offer the chance to build credit, earn cash back or benefit from a promotional interest-free period.

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College graduation is anything but traditional this year thanks to the coronavirus pandemic. While it probably seems like much is out of your control right now — like future job prospects or renting a new apartment — there are certain financial milestones you can take to steer yourself in the direction you want.

Opening your first credit card is an important step on your journey to financial success and something you can do today. And if you already have a student card, now could be a good time to upgrade to a new card that's better suited for the needs of your post-grad life.

As a recent college graduate, you should aim to open a credit card with a low or no annual fee, especially if you don't have a job yet. Annual fee cards can be an unnecessary cost — and as your credit improves, there will be lots of time to enjoy a premium credit card one day. With this in mind, four out of the five cards we recommend below have no annual fee.

If you have no credit history or bad credit, you can start off with a secured card or a card that doesn't check your credit report. If you started building credit in college, you may have a fair, good or excellent credit score that allows you to qualify for a cash-back card or interest-free offer.

Before you apply for any of the cards below, check your credit score. This helps you narrow down the cards you may qualify for and makes the decision process a bit easier.

Now onto our list: Below, we review the best credit cards for college graduates, sorted by what credit score you need, so you can find the next card for your wallet.

Best credit cards for college graduates

See how they all compare.

Best card for no credit

Petal® Visa® Credit Card

Petal® Visa® Credit Card
Information about the Petal® Visa® Credit Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.
  • Rewards

    1% cash back on eligible purchases and 1.5% after you make 12 on-time monthly payments

  • Welcome bonus

    None

  • Annual fee

    $0

  • Intro APR

    None

  • Regular APR

    14.49% to 25.49% variable

  • Balance transfer fee

    None

  • Foreign transaction fee

    None

  • Credit needed

    N/A

See our methodology, terms apply.

Pros

  • No credit history required (if you do have a credit history, that does factor into the credit decision)
  • No fees whatsoever
  • 1.5% cash back on eligible purchases after making 12 on-time monthly payments
  • Credit limits range from $500 to $10,000

Cons

  • Card isn't for rebuilding credit, but it's good for building credit
  • No special financing offers
  • No welcome bonus
  • Estimated rewards earned after 1 year: $249
  • Estimated rewards earned after 5 years: $1,577

Who's this for? Recent grads who didn't have a credit card in college or who don't currently have any information on their credit reports need a card for people just starting out. Our first choice is the Petal® Visa® Credit Card, issued by WebBank Member FDIC.

The Petal Card doesn't set credit requirements, so if you have no credit history, you may qualify for this card over alternatives. During the application process, you may be asked to link bank accounts so the creditor can review your bank statements and other data, such as bill payments and earnings. If you have a history of paying your other bills on time, or if your bank account shows regular income, Petal will consider this in your application.

But keep in mind, if you do have a credit history, it will factor into the credit decision.

Beyond a unique application process, the Petal Card forgoes many common credit card fees. There are no annual fees, no late payment fees and no foreign transaction fees.

Plus cardholders can earn 1% cash back on eligible purchases, which can increase to 1.5% cash back after you make 12 consecutive, on-time monthly payments. This is a great way to encourage timely payments, which is the most important factor of your credit score.

Check out the best credit cards for building credit.

Best card for bad credit

Capital One® Secured Mastercard®

Capital One® Secured Mastercard®
Information about the Capital One® Secured Mastercard® has been collected independently by CNBC and has not been reviewed or provided by the issuer of the cards prior to publication.
  • Rewards

    This card doesn't offer cash back, points or miles

  • Welcome bonus

    No current offer

  • Annual fee

    $0

  • Intro APR

    N/A for purchases and balance transfers

  • Regular APR

    26.99% variable on purchases and balance transfers

  • Balance transfer fee

    None

  • Foreign transaction fee

    None

  • Credit needed

    No credit history

See our methodology, terms apply.

Pros

  • No annual fee
  • $49, $99 or $200 refundable deposit
  • Get access to a higher credit line after making your first five monthly payments on time
  • No fee charged on purchases made outside the U.S.
  • Flexibility to change your payment due date

Cons

  • High 26.99% variable APR
  • No rewards program
  • After you apply and submit your deposit, it takes 2-3 weeks to get your card
  • Capital One periodically reviews your account to see if you can be transitioned to an unsecured card, but unlike the Discover it® Secured Card there’s no clear timeline for when this will occur

Who's this for? If you have bad credit, the card options you have to choose from are typically limited. Your choices will likely include cards with annual fees and high interest rates or secured cards that require a deposit. A secured card, such as the Capital One® Secured Mastercard®, is a great way to rebuild credit and work up to an unsecured card.

The Capital One Secured Mastercard is unlike other secured cards that require a minimum $200 security deposit. Cardholders have the opportunity to qualify for a lower $49 or $99 deposit, based on your creditworthiness, and still receive a $200 credit limit. If you don't qualify, the minimum deposit is $200.

This card also provides the chance to get a higher credit limit (with no additional deposit) after you make your first five monthly payments on time. This is a great incentive to maintain positive payment history.

Check out the best credit cards for bad credit.

Best card for fair and average credit

Capital One® QuicksilverOne® Cash Rewards Credit Card

Capital One® QuicksilverOne® Cash Rewards Credit Card
Information about the Capital One® QuicksilverOne® Cash Rewards Credit Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.
  • Rewards

    1.5% cash back on all purchases

  • Welcome bonus

    None

  • Annual fee

    $39

  • Intro APR

    None

  • Regular APR

    26.99% variable

  • Balance transfer fee

    None

  • Foreign transaction fee

    None

  • Credit needed

    Good/Fair

See our methodology, terms apply.

Pros

  • Unlimited 1.5% cash back on all purchases
  • Redeem cash back at anytime and for any amount
  • No fee charged on purchases made outside the U.S.
  • Access a higher credit limit after making your first five monthly payments on time

Cons

  • $39 annual fee
  • 26.99% variable APR
  • No welcome bonus
  • Estimated rewards earned after 1 year: $293
  • Estimated rewards earned after 5 years: $1,464

Who's this for? Grads who started building credit late in college or are recovering from mistakes they made when they were younger may now have a fair/average credit score. If that's you, don't think rewards cards are out of reach. The Capital One® QuicksilverOne® Cash Rewards Credit Card requires average credit and offers a decent 1.5% cash back on all purchases.

Similar to the Capital One Secured Card, you can receive a higher credit limit after making your first five monthly payments on time, which can be helpful if you're not approved for a high credit limit right away.

While this card has a $39 annual fee, you can offset it by spending $2,600 a year on your card (see our methodology below). This might be manageable if you work part-time or full-time.

The QuicksilverOne Card is a good choice if you plan to travel outside the U.S. since there are no foreign transaction fees and it comes with travel accident insurance, auto rental collision damage waiver and 24-hour travel assistance services.

Check out the best credit cards for fair and average credit.

Best card for good credit

American Express Cash Magnet® Card

American Express Cash Magnet® Card
On American Express's secure site
  • Rewards

    Unlimited 1.5% cash back on all purchases

  • Welcome bonus

    Earn a $150 statement credit after you spend $1,000 in purchases in your first 3 months

  • Annual fee

    None

  • Intro APR

    0% intro APR on purchases and balance transfers for 15 months from the date of account opening

  • Regular APR

    12.99% to 23.99% variable

  • Balance transfer fee

    Either $5 or 3%, whichever is greater

  • Foreign transaction fee

    2.7%

  • Credit needed

    Excellent/Good

See rates and fees and our methodology, terms apply.

Pros

  • No annual fee
  • Earn a $150 statement credit after you spend $1,000 in purchases in your first 3 months
  • 0% intro APR on purchases and balance transfers for 15 months from the date of account opening (after 12.99% to 23.99% variable)

Cons

  • 2.7% fee on purchases outside the U.S.
  • Cash back comes in the form of a statement credit (with a minimum redemption of $25)

Who's this for? If you have a good credit score and want to earn cash back while benefiting from special financing offers, the American Express Cash Magnet® Card is a great choice. It requires good to excellent credit and offers 1.5% cash back on all purchases.

Plus you can earn a $150 statement credit after you spend $1,000 in purchases in your first three months from account opening, which is a nice added perk if you can reasonably meet the requirements.

The Cash Magnet also offers a great introductory 0% APR for 15 months from the date of account opening (then 12.99% to 23.99% variable APR). This provides you with over a year to pay off new purchases and/or transferred debt from a non-Amex card.

Take note that balance transfers must be completed within the first 60 days from account opening and are subject to a 3% fee ($5 minimum). However, this fee can be cheaper than keeping debt on a high interest card.

Cardholders can also take advantage of discounts at select merchants via Amex Offers and  free two-day shipping from over 100 retailers with ShopRunner.

Check out the best credit cards for good credit.

Best card for excellent credit

Citi® Double Cash Card

Citi® Double Cash Card
Information about the Citi® Double Cash Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.
  • Rewards

    2% cash back: 1% on all purchases and an additional 1% after you pay your credit card bill

  • Welcome bonus

    No current offer

  • Annual fee

    $0

  • Intro APR

    0% for the first 18 months on balance transfers; N/A for purchases

  • Regular APR

    13.99% - 23.99% variable on purchases and balance transfers

  • Balance transfer fee

    3%, minimum $5

  • Foreign transaction fee

    3%

  • Credit needed

    Excellent

See our methodology, terms apply.

Pros

  • 2% cash back on all purchases
  • Simple cash-back program that doesn't require activation or spending caps
  • One of the longest intro periods for balance transfers at 18 months

Cons

  • No welcome bonus, so you can’t maximize rewards during the first few months of card opening
  • Minimum cash-back redemption of $25
  • 3% fee charged on purchases made outside the U.S.
  • Estimated rewards earned after 1 year: $437
  • Estimated rewards earned after 5 years: $2,185

Who's this for? If you worked hard on building your credit in college and graduated with an excellent credit score, you may qualify for some of the best cards. The Citi® Double Cash Card is our top choice for a no-annual-fee cash-back card with a simple, yet competitive rewards program.

Cardholders earn 2% cash back on all purchases — 1% when you make a purchase and an additional 1% when you pay your credit card bill. This is one of the highest flat-rate rewards programs available and lets you earn without having to keep track of bonus categories or activation.

In addition to rewards, cardholders receive free two-day shipping at select online retailers with ShopRunner, just like the Amex Cash Magnet Card mentioned above.

This card also provides one of the longest 0% APR periods for balance transfers at 18 months (after 13.99% to 23.99% variable APR). This can be helpful if you need to transfer debt from another non-Citi card. Keep in mind balances must be transferred within four months from account opening, and there's a 3% balance transfer fee (minimum $5).

Check out the best credit cards for excellent credit.

Best credit cards for college grads

Category No credit Bad credit Fair and average credit Good credit Excellent credit
Credit cardPetal® Visa® Credit CardPetal® Visa® Credit CardCapital One® Secured Mastercard®Capital One® Secured Mastercard®Capital One® QuicksilverOne® Cash Rewards Credit CardCapital One® QuicksilverOne® Cash Rewards Credit CardAmerican Express Cash Magnet® CardAmerican Express Cash Magnet® CardCiti® Double Cash CardCiti® Double Cash Card
Rewards1% cash back on eligible purchases and 1.5% after you make 12 on-time monthly paymentsNone1.5% cash back on all purchases1.5% cash back on all purchases2% cash back: 1% on all purchases and an additional 1% after you pay your credit card bill
See below for our methodologyLearn MoreInformation about the Petal® Visa® Credit Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.Learn MoreInformation about the Capital One® Secured Mastercard® has been collected independently by CNBC and has not been reviewed or provided by the issuer of the cards prior to publication.Learn MoreInformation about the Capital One® QuicksilverOne® Cash Rewards Credit Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.Learn MoreOn American Express's secure siteLearn MoreInformation about the Citi® Double Cash Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.

Our methodology

To determine which credit cards offer the best value, CNBC Select analyzed popular credit cards available in the U.S. We compared each card on a range of features, including rewards, welcome bonus, introductory and standard APR, balance transfer fee and foreign transaction fees, as well as factors such as required credit and customer reviews when available. We also considered additional perks, the application process and how easy it is for the consumer to redeem points.

CNBC Select teamed up with location intelligence firm Esri. The company's data development team provided the most up-to-date and comprehensive consumer spending data based on the 2019 Consumer Expenditure Surveys from the Bureau of Labor Statistics. You can read more about their methodology here.

Esri's data team created a sample annual budget of approximately $22,126 in retail spending. The budget includes six main categories: groceries ($5,174), gas ($2,218), dining out ($3,675), travel ($2,244), utilities ($4,862) and general purchases ($3,953). General purchases include items such as housekeeping supplies, clothing, personal care products, prescription drugs and vitamins, and other vehicle expenses.

CNBC Select used this budget to estimate how much the average consumer would save over the course of a year, two years and five years, assuming they would attempt to maximize their rewards potential by earning all welcome bonuses offered and using the card for all applicable purchases. All rewards total estimations are net the annual fee.

While the five-year estimates we've included are derived from a budget similar to the average American's spending, you may earn a higher or lower return depending on your shopping habits.

Don't miss: What to do if you have no credit after college

For rates and fees of the American Express Cash Magnet® Card, click here.

Information about the Petal® Visa® Credit Card, Capital One® Secured Mastercard®, Capital One® QuicksilverOne® Cash Rewards Credit Card and Citi® Double Cash Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the CNBC Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.