It’s difficult to get approved for most popular miles & points cards without an excellent credit score, or if you have a blemish on your credit report. That’s why folks sometimes ask if there’s a good card to help build a credit history.
Besides making you eligible for better rewards cards in the future, establishing a credit history helps if you’re looking to qualify for other types of credit, like car loans and mortgages.
I think the no annual fee Capital One® Platinum Credit Card is a great fit for folks new to the US, recent graduates, or if your credit score is ~650. But this card is NOT ideal if you’re looking to earn rewards, like cash back or miles & points.
Here’s What You Should Consider Before Signing-Up for a Credit Card
Credit cards are a great tool to have in your wallet. But I only recommend applying for a card if you plan to use it responsibly.
This means tracking your credit card balances and paying them on time and in full each month. Because most cards charge high interest rates when you carry a balance. And paying credit card interest can make it difficult to get ahead financially.
Emily and I have used miles & points credit cards responsibly over the years, which helped us earn enough rewards to travel to Bora Bora, Europe, and many other destinations around the world! But these cards typically require you to have a 700+ credit score. You can check your credit score for free by using Credit Karma.
Keep in mind, having a credit card and paying your bill in full each month can increase your credit score. This can make you eligible to get better cards and earn Big Travel with Small Money!
I’ll share a card for folks who have credit scores under 700 and are looking to improve their credit and build a credit history.
Capital One Platinum Card Review
The Capital One Platinum card has no annual fee. There’s also no sign-up bonus or rewards for ongoing spending.
This card is meant for folks with an average credit profile. For example, if you have limited credit history or a credit score between ~630 and ~700.
I found a data point on the myFICO forum for someone who was approved for the Capital One Platinum card with a 581 credit score. They also mention their credit score increased significantly after having the card for just a couple of months.
If approved for this card, you’ll typically have a lower initial credit limit. But you get access to a higher credit line after making on time payments for the first 5 months.
Remember, you do NOT want to use a large percentage of your credit limit. Because according to the FICO website, 30% of your credit score is determined by your outstanding balances and credit utilization.
With this card, you’ll also have access to CapitalOne CreditWise. This a free tool to monitor activity on your credit report and get your estimated credit score.
The upside of establishing a relationship with Capital One using the Capital One Platinum card is you can qualify to upgrade to the bank’s other cards.
For example, you can potentially upgrade to the no annual fee Capital One® Quicksilver® Cash Rewards Credit Card, which earns you unlimited 1.5% cash back on ALL purchases!
Are There Drawbacks?
Remember, Capital One pulls your credit score from all 3 main credit bureaus, giving you 3 hard inquiries on your report! This is not ideal, because hard inquiries cause your credit score to temporarily dip. And too many hard inquiries can make it harder to be approved for future credit cards and other loans.
And the Capital One Platinum card does NOT earn you rewards like cash back or points.
Instead, you might consider the Journey® Student Rewards from Capital One®. This card has similar approval requirements. And you earn 1% cash back on all purchases. And an extra 0.25% for paying bills on time.
Folks with a limited credit history or credit score between ~630 and ~700 might consider the no annual fee Capital One® Platinum Credit Card. I found someone who was approved for the card with a 581 FICO score.
When you use this card responsibly, you can boost your credit score and become eligible for more rewarding miles & points credit cards. Or you might consider the Journey Student Rewards from Capital One, which has similar approval requirements. And you earn 1% cash back on all purchases.
Remember to only sign-up for credit cards if you can afford to pay your balances in full each month. This way, you’ll avoid costly interest charges.