Dealing with the stress of no job is already hard enough. Now consider the fact that you need a credit card, without an active source of income. That can seem impossible. How can you build credit? Can you get a credit card without a job? These questions and more will be answered within this article. Fortunately, there is hope for people who are interested in getting a credit card, even if they do not have a source of income!
However, you want to be especially careful. If you do not have enough income to support your credit card then you run the risk of missing payments and having high utilization. Both of those components can negatively impact your credit score. You want to take extra care of your credit if you get a credit card while you don’t have a source of income.
Do You Need a Job to Get a Credit Card?
Not necessarily! It depends on the card you are interested in getting. There are secured and unsecured credit card options. If you do not have enough verifiable income then you may have a hard time qualifying for an unsecured credit card. That means your best bet would be the secured alternative. However, there are options for people who have no income and no employment as well.
How Can I Get a Credit Card with No Income?
You actually have some options when it comes to getting a credit card if you don’t have a job or source of income. You first want to see if you are pre-approved for any credit card with all your information. These pre-approval checks are usually a soft inquiry which does not affect your score. Understanding how to list income when trying to get a credit card can be challenging.
How to Handle Income on Your Credit Card Application
The Credit Card Accountability Responsibility and Disclosure Act of 2009 state that card issuers are legally required to take the applicant’s ability to make payments into consideration before opening a new account.
In order to make a decision, card issuers typically ask for information from the applicant. Information like financial obligations, annual income, etc. will be what you need to provide. Besides income received from a part-time or a full-time job, these sources of income could include:
- Unemployment Benefits: Any money you’ve received from unemployment can be listed on your application.
- Retirement Income: Money that you’ve received from Social Security or a retirement account can be listed on your application.
- Any Shared Household Income: If your partner earns income, you can list it on your application.
- Self-Employment Income: If you have a side gig, like making resin products, income you receive from that can be listed on an application. Freelance projects that earn you money can also be listed.
- Additional Sources of Money: You may be able to include money from somebody who regularly deposits funds into your individual (or joint) account.
If you are an applicant that is below 21, you may need to show proof of your independent ability to repay what you borrow. Not every credit card application is the same. That is why when trying to get a card, you want to talk to customer service about acceptable forms of income on the application.
What Credit Card Can I Get with No Job?
If your goal is to get a credit card, and not just build your credit history, then you still have options. Your best bet would be to get a secured credit card. The difference between an unsecured and secured credit card is fairly simple. Unsecured credit cards are not funded by you, while secured credit cards are. Secured credit will require a downpayment by the applicant to set the limit of the card. Usually, there is a minimum down payment requirement but it varies by lender. A good lender for secured credit cards is Capital One.
Can I Get a Capital One Credit Card with No Job?
You can first see if you are pre-approved for all types of credit cards before deciding on a secured one. Capital One has free tools that allow you to see what you may qualify for without affecting your credit score. If eligible, you may be able to qualify for a secured credit card account. You will need to do a few things if you want to open this line of credit.
First and foremost you will need to pay an upfront amount of money as collateral for the credit card. This refundable security deposit protects the lender if you do not keep up with payments. The lender will decide the amount of money needed for the line of credit. You may be able to have your limit increased if:
- Consistent payments are made over time.
- You put up a large security deposit for the secured credit card.
- Additional money is added to your credit line.
What Are Other Ways I Can Build My Credit?
Sometimes, a secured credit card may not be right for you. However, with no income and no credit card, how can you build your credit history? Luckily, there are still ways you can contribute to your credit history in order to strengthen your credit score. These ways can be easier to get approved for than a typical credit application.
Have Someone Make You an Authorized User
An authorized user is an individual that has been added as an additional cardholder/user on someone else’s credit card account. The account holder that you would be added onto should be a trusted family member or friend. The reason they need to be trusted is that you want to ensure they are responsible with their credit.
When you become an authorized user, you will likely receive your own credit card. This credit card will be linked to the existing account you were added to. Regardless of the transactions you make, the primary cardholder will be the one who is responsible for that credit account.
If you want to become someone’s authorized user, you will need to have a talk with them. You both should have clear expectations about how the credit will be used. The agreement should be understood completely by both parties. It may even help to have a written agreement between the primary cardholder and the authorized user. This will provide the support that each party will respect the terms and conditions.
Get a Co-Signer to Help
If you are struggling to get approved for credit on your own, consider a co-signer to help. A co-signer is someone that guarantees to pay the balance on your account if you don’t. This leaves them ultimately responsible. If you mishandle this line of credit, it can have an impact on their score.
Every credit card issuer is different. Some may not allow co-signers. However, this could be a good option if you do not qualify for a credit card on your own. You may also want to consider an agreement between you and the co-signer that sets the terms and conditions. Account accessibility of the cosigner varies by lender. That means you need to be honest about missing payments and how you have managed your credit. Their name is attached, so you should be respectful.
Why Do You Want a Credit Card? Will You be Responsible?
Being unemployed doesn’t mean you should not have a credit card. However, if you do not have a consistent flow of income, but add additional bills, you may hurt yourself. Credit can become unmanageable easily. When this happens, you may hurt your score. You can dig yourself in a hole that takes years to get out of.
Credit must be handled responsibly. When picking an issuer, find one that offers free financial management tools. These tools can help you take control of your finances, and ultimately enhance your financial standing if used correctly. For example, if you got a credit card from Capital One, you could use their free CreditWise tool. This can help you monitor your credit.
Other available online tools include getting a free credit report from AnnualCreditReport.com. You can even use search engines to lookup more available tools online. The answers are out there, you just need to find them!
Still Need Support?
If you are unemployed, have no income, and are still struggling with your situation, you may need additional support. It is okay to need to seek help from a professional. Getting a credit card may not be what you need to do for your situation. You don’t want to hurt your credit score if you don’t have to. There are experts that handle financial management plans. These plans can provide you clear-cut instructions on what you need to do with your financial situation.
Some of these companies require payment but you may be able to find free nonprofit resources in your area. You may also want to consider federal and local resources. These resources are completely free.
It is very possible to get a credit card if you do not have a job or a source of income. However, if you decide to get a credit card, you want to make sure to handle the payments responsibly. If you do not handle your credit with care, those mistakes can stay visible on your credit history and hurt your credit score.
There are other ways you can build your credit history. Becoming an authorized user, or having a cosigner on your application could allow you to get the necessary items in order to build your credit score. When picking a card issuer, you want to find one that also offers free credit management tools. Even if it is just credit monitoring, free tools are better than no tools.
If your situation is too dire to handle on your own, you should seek the help of a professional. There are specialists that can help you come up with a financial management plan that works for your situation.
- Segal, Troy. “What the CARD Act Does For You.” Investopedia, Investopedia, 7 May 2021, www.investopedia.com/terms/c/credit-card-accountability-responsibility-and-disclosure-act-of-2009.asp.
- White, Alexandria. “What You Need to Know about Being an Authorized User on a Credit Card.” CNBC, CNBC, 28 Jan. 2021, www.cnbc.com/select/becoming-an-authorized-credit-card-user-what-you-should-know/.