Introduction:
Rewards credit cards can be a great way to earn cash back, points, or miles on your everyday spending. However, not all rewards cards are created equal. Some of the best rewards cards require good or excellent credit for approval. If you're new to credit card rewards, you may be wondering what credit score you need to qualify. In this article, we'll break down the credit score requirements for rewards cards and provide tips for building your credit.
Understanding Credit Score Ranges
Before we dive into the specifics of rewards cards, let's review how credit scores are categorized:
- Poor (300-579): A poor credit score suggests a history of missed payments, high credit utilization, or other negative financial behaviors.
- Fair (580-669): A fair credit score indicates that you're building credit but may have some blemishes on your credit report.
- Good (670-739): A good credit score demonstrates responsible credit management and makes you eligible for more competitive credit card offers.
- Very Good (740-799): A very good credit score reflects a strong credit history and opens doors to the best interest rates and loan terms.
- Excellent (800-850): An excellent credit score is the gold standard, signifying exceptional creditworthiness.
Credit Score Requirements for Rewards Cards
Generally, you'll need at least a good credit score (670 or higher) to qualify for most rewards credit cards. However, the specific credit score requirements can vary depending on the card issuer and the type of rewards card:
- Secured Rewards Cards (Fair Credit): If you're starting with fair credit, a secured rewards card can be a good option. These cards require a security deposit that's typically equal to your credit limit.
- Entry-Level Rewards Cards (Good Credit): With a good credit score, you can access entry-level rewards cards that offer basic cash back or points on purchases.
- Premium Rewards Cards (Very Good to Excellent Credit): For premium rewards cards with high earning rates, travel benefits, and other perks, you'll typically need a very good or excellent credit score.
Tips for Building Your Credit
If your credit score isn't where you'd like it to be, don't worry! There are steps you can take to improve it:
- Make On-Time Payments: Payment history is the most crucial factor influencing your credit score.
- Keep Credit Utilization Low: Aim to keep your credit utilization rate (the amount of credit you're using versus your total available credit) below 30%.
- Check Your Credit Report Regularly: Review your credit report for errors and dispute any inaccuracies.
- Become an Authorized User: Ask a trusted friend or family member to add you as an authorized user on their credit card.
By following these tips, you can build a positive credit history and increase your chances of getting approved for the rewards credit cards you desire.
