Dear Clever Credit,
I am a 20-year-old college student with a Discover it® Student Cash Back card. My credit score is 774. I want another card that will give me better rewards for what I actually buy. My biggest expense is groceries. I applied for the Blue Cash Everyday® Card from American Express and was denied. I think it was because of my annual income, which is around $15,000. What would you recommend for my next card? I want one that I can keep for years so I can build my credit history.
Signed,
Ready to Graduate
Dear Graduate,
Bummer about the Blue Cash Everyday! I understand the appeal since it offers 3% cash back at U.S. supermarkets. But yes, your income was most likely a deciding factor in your denial, and possibly your credit history (or lack thereof).
My recommendation would be to check out the Capital One Savor Student Cash Rewards Credit Card. It offers:
— Unlimited 3% cash back at grocery stores (excluding superstores like Walmart and Target)
— Unlimited 3% cash back on dining
— Unlimited 3% cash back on entertainment and popular streaming services
— Unlimited 1% cash back on all other purchases
You can also earn 8% cash back on entertainment purchases when you book through the Capital One Entertainment portal and unlimited 5% cash back on hotels and rental cars when you book through Capital One Travel.
The Savor Student also has no annual fee and, unlike the Blue Cash Everyday and Discover it Student Cash Back, there’s no cap on how much cash back you can earn. It also has no foreign transaction fees, in case you’re thinking of taking a semester abroad.
And yes, it is a student card, but you should take advantage of student credit cards while you can. They’re easier to get, and you can eventually upgrade many of them, the Savor Student card included.
[READ: Best Credit Cards for Students]
After a few months, you might reach out to Capital One and see if you’re eligible for an upgrade. You’ll have better odds, though, if your income increases. You can upgrade to the Capital One Savor Cash Rewards Credit Card, and the rewards are exactly the same.
However, it’s worth noting that even if you’re not eligible for an upgrade right away, you don’t lose any benefits or rewards once you graduate. So there’s no rush, and you can continue building your credit history with it. Just be careful with how many credit cards you apply for while in college. There’s no need to have so many, especially when you’re just starting out. Stick with two for now, and use them to build your credit history. Then, once you get your first real job after college, you can reward yourself with a new card that fits your (new) needs.
Good luck!
More from U.S. News
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How to Upgrade Your Credit Card
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Dear Clever Credit: I’m in College. What Should My Next Credit Card Be? originally appeared on usnews.com
