It's a lot tougher to get a credit card these days, especially if you're going for your first one. Consumer Reports has advice on how young people can get a card without paying hefty fees.
College student Daniel Lehrman was rejected for the first two credit cards he applied for.
Daniel Lehrman: "They said I didn't have enough credit history at all, and they couldn't back
me for a card."
Consumer Reports' money experts say that even if you are able to get a credit card when you have little or no credit history, the cards are often a bad deal.
Mandy Walker/Consumer Reports: "These can have huge start-up costs, big maintenance fees, and giant interest rates."
Take the Matrix Card by Discover from Continental Finance. It has a $75 annual fee, plus a $12 monthly fee that kicks in after the first year.
And the First Premier Bank Card has a super-high APR — a whopping 36%!
Mandy Walker: "One of the best options for a first-time cardholder is to get a secured card. It'll require a security deposit that's generally equal to your credit limit."
The Capital One Secured MasterCard is better than many. It has an annual fee of $29 and its APR is currently 22.9%. And it has a low late fee of no more than $19.
Mandy Walker: "If you get a card and establish a good payment history for a year to a year and a half, you can then ask for another one with better terms."
Daniel was finally accepted for a credit card and knows he has to use it carefully.
Consumer Reports says developing good habits with your first credit card can spare you a lifetime of financial grief. Make a point of paying off the balance every month. That way you won't get buried in debt end up paying oodles of money in interest charges.
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