Introduction

This guide to credit cards and credit records targets at the young people with buddhist mind, i.e. those who do not want mess up with all different kinds of loyalist programs (think AA-Advantage, UA-MileagePlus, Hilton-HHonors and so on) but want to simply maximize the cash back and build up a wonderful credit records through applying and responsibly using credit cards.

Credit Records

Before diving into all different kinds of credit cards, we should first get some knowledge about the credit record. After all, this is the tiny record that will affect the success rates of all our credit card application. And a good credit record would mean a lot of differences in interests we would have to pay when we apply a loan of large amount e.g. a mortgage.

Contrary to popular belief, the credit record is not a number that indicates your credibility. It’s an ensemble of raw data about your credit accounts, collections, inquiries, public records.

• Credit accounts may include credit card and loans. There would be detailed data about the statement balance of each month of each credit account and whether you make payments to your credit accounts on time.
• Collections are records of accounts, (think gas account, cellphone account) that is seriously overdue and turned over to the collection agency (who will try to get money back from you).
• Inquiries are the records of you applying for credit because each record here corresponds to a credit (credit card, loan) application.
• Public records are the data about bankruptcies or court order under your name.

Normally people with good credibility would have no collections or public records. So what we have to worry about in the credit records are mainly credit account records and inquiries. These are two things we can control to make our credit records look better. Two important figure about credit accounts are credit history length of the oldest account and the average credit history length across all credit accounts to which banks would put lots of attentions when you apply for a new credit account. To make these two firgure look better, there are following two suggestions:

• Apply an credit card with zero annual fee as your first credit card. And keep this credit card open all the time.
• When possible, always perform product change rather than close the credit card. The new credit card resulting from the product change would inherit the credit history from the old one.

Other suggestions to make your credit record look better include:

• Remember to set up auto payment for each of your credit card. This way you can prevent any overdue record showing up on your credit records. You can still pay the credit card before the statement closes if your available credit line is not enough for your next purchase.
• Do not open new credit account for at least half a year before any major loan application. The benefit you can get from a credit card can’t pay off the increase of interests resulted from the hard inquiry.

There are three major credit bureaus at US: Experian, Equifax and TransUnion. All of them provide services for business clients to look up the credit reports of their customers. Your credit records at each of the bureau should be almost the same with exceptions for hard inquiries: Hard pulls are only left on the version that’s requested. Normally banks only request credit reports from two credit bureaus for cross verification and reference.

We can monitor our credit reports for free. Experian offers free credit report of its own version. To freely monitor the versions from Equifax and TransUnion, you can turn to CreditKarma.

Credit Scores

Now what are the credit scores we see here and there? These credit scores are produced by certain model built upon your raw credit record data. Let’s view the credit model as a function, if we supply the raw credit record data, we can get credit sores are the outputs. There are two kinds of credit scores easily accessible: FICO and Vantage. We can get free monthly updated FICO scores from different credit card issuers like AmEx, Discover and Citi as a benefit for the credit card holders. Discover even offers a free FICO score to non-holder through the service named credit scoreboard. And we can get free weekly Vantage score from Mint or the aforementioned CreditKarma.

Credit Card Recommendations

Finally we can look into some credit cards. Again, we will not talk about credit cards that involves different loyalist programs. Please refer to Uscreditcardguide for these deep♂dark♂fantansy.

Discover it

Wonderful zero-annual-fee credit card offered by Discover. It comes with one or two 5% cashback category (for the first $1500 spending) each quarter which include restaurant, grocery store, drug store, gas station, Amazon, department stores. All other purchases earn 1% cash back. And you even get double cash back for your first card membership year. Think about it, 10% off at Amazon at the shopping season! Sign-up bonus is $150 after $500 spend in the first 3 months of card opening. It doesn’t charge any foreign transaction fee or dynamic currency conversion fee which is a great plus if you like travelling abroad. And Discover is famous for granting discover it card to applicants with zero credit history. So my advice is: once you receive the letter from the SSA office, go ahead and apply for the discover it card. Sign-up bonus is $50 statement credit with no spending requirement. Affiliate application link.

Chase Freedom

Wonderful zero-annual-fee credit card offered by Chase. It comes with one or two 5% cashback category (for the first $1500 spending) each quarter which include restaurant, grocery store, drug store, gas station, Amazon, department stores. All other purchases earn 1% cash back. Sign-up bonus is $150 after $500 spend in the first 3 months of card opening. Unluckily, it does have foreign transaction fee if you use it abroad. So you better use Discover it card abroad. Chase has 5/24 rule on credit card application, so my recommendation is to apply Chase Freedom as your second credit card when you have establish certain credit history(6-9 months). It would help on the applications if receive direct deposit on a chase checking account monthly. Affiliate application link.

American Express Blush Cash Everyday

Good credit card for grocery spending since it offers 3% cashback at U.S. supermarkets, 2% cashback at gas station and %1 cashback on all other purchases. Use this card at grocery store when the other 3 5% card don’t have bonus category as grocery store. Amex tends to be very generous on granting credit card applications. Foreign transaction fee exists on this card. There used to be $250 sign-up bonus before, but we could only see $200 sign-bonus for the last year. Application link.

Citi Double Cash

Very simple credit card. Earn 1% cashback when purchasing and earn 1% cashback when make payments. This card is good for non-category spending. There is foreign transaction fee. No sign-up bonus. Since there is no sign-up bonus, my recommendation on getting this credit card is to do product change from some other Citi credit cards with sign-up bonus. Citi has strange 24 month rule on sign-up bonus which is related to product change. So if there is any chance you will one day go into the world of ‘New Nippori’, i.e. apply for credit cards with annual fees to earn Citi TYP or AA miles, please read this post before you proceed to do product change. Application link. Once again I do not recommend to apply for this card directly.

Citi Dividend

Citi’s 5% cashback credit card. One difference is that it has annual cap of $6000 on 5% cashback purchases rather than quarterly cap of $1500 on 5% cashback purchase like Chase Freedom and Discover it. It is no longer available through direct application. But you can still get it through product change. If you have any unwanted credit card with annual fee, call Citi and politely ask to be changed to Citi Dividend. Again, read the last part of the Citi Double Cash before you proceed. There is foreign transaction fee on this card.

Boa Cash Reward

It has a lovely name ‘BOA 123’ because it offers 3% cashback on gas station purchase, 2% cashback on grocery stores and wholesale clubs and 1% cashback on other purchases. The wonderful part about this card is that if have a large amount of deposit at BOA you can get extra cashback: 10% bonus on cashback for a regular BOA account, 25% for a Gold tier BOA account($20k or more in deposit), 50% for platinum tier($50k or more in deposit), and 75% for platinum honor tier($100k or more in deposit). Another good news is that you can get this card even if you don’t have SSN or any credit history as long as you have certain amount of deposit at BOA. Unluckily, there is foreign transaction fee on this card. Sign-up bonus is $150 after spending $500 in 3 months if you apply online. There is no sign-up bonus if you apply in branch. Application link.

Barclay Uber Credit Card

It should be given a lovely name “Barclay 1234” although no one is calling it so right now. It offers 4% cashback on restaurant, 3% cashback on airfare and hotels, 2% cashback on online purchases and 1% on all other purchases. No foreign transaction fee is a plus. Opening bonus is currently at $100 after $500 expenses. Application link.

Designed journey for credit card applications

Non-buddist Youngers

Please go ahead and dig into the deep♂dark♂fantansy

SSN holders

Discover it (Month #0) -> Chase Freedom (Month #6~9) -> Amex BCE(Month #6-#9) -> Citi TYP Prestige/Citi TYP Premier or Citi AA Platinum/Gold(Month #12)(get ready to product change to Citi Dividend/Double Cash) -> Barclay Uber(Month #20) -> Product change (Month #24)

No SSN

BOA 123(Month #0) -> Citi TYP student (#Month 3) -> Amex BCE(Month #6-#9) -> Citi TYP student product change to Citi Double Cash or Citi Dividend (#Month 15)