@Anonymous wrote:I received my first ever credit card today, the Capital One secured for $200. My question is, can I build good credit history by spending only $10 a month on it? I've been told that I should keep my utilization at 9% and open at least one more secured account with another bank. Should I open another secured account? I was originally hoping to get a discover or Amex card at my 6 month mark and cut up Capital One. I read too many horror stories of CO being a preditory lender and it kinda scares me to stick with them for the long haul.
Congratulations on getting started.
Use the $200 limit for regular spend, just don't go over the limit. You can pay it frequently if you like, but I would disregard the idea of trying to spend only $10 per month on it. It is simply not realistic, and you are building a credit file. The FICO scores will follow, and utilization effects on your score are only for today. You can decide to optimize your score at any point in the future, pay the card a bit faster to lower utilization, and see the few points boost in your score. Or not worry about it, because it is only a few points due to utilization.
I would not close the Capital One Secured card. Rather, when you get further along, see if you can get a regular Capital One Platinum or Quicksilver with no AF, and only after that, consider closing the Secured card, but take that decision slow. I've had a Capital One card since 2003, it was a Platinum card, always $10k limit, always 10.9% APR, and even when other lenders were running CLD on my other accounts, Capital One never blinked, never gave me any static. Capital One may not be the flashiest CCC, but they are, in my opinion, one of the most stable, and a good card to have in your wallet forever. My observations of others experience here; it is better to have a Capital One card in your wallet, then apply for a higher tier CapOne card when you want to jump up in credit line. That is the experience of many who were frustrated with the stuck limits on QS and Platinum cards, then applied for Venture and are happy with the significantly higher CL. This tends not to happen, the really big CL don't often appear, if someone had a CapOne card, then closed it and did not have a CapOne card in hand when they applied for Venture. Not to say new applicants cannot get a good Venture, they can, but to have the best chance, have a Capital One already in your wallet and not closed.
Apply for the other cards after 3 to 6 months, the Freedom card is a good choice, AMEX Every Day or Blue Cash, a basic Citi card as well. You mention not wanting holds on payments, and that implies you want to pay the card to zero quickly. That isn't really necessary, just arrange it so you don't go over the credit line, and if you want to pay in full, time that so the payment is done by the payment due date on the statement. Paying before statement cuts is overdoing it, in my opinion.
Good luck!
