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Question By
BluRain13

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Secured Credit card worthwhile?
All Q&A's I see about this are from a year or older, so looking for personal experience or recent? I am stable with savings and 401K (same job, bank account 10 yrs +) and have only 2 things appearing on my credit report, 2 medical bills totaling 114.00. I could pay both off, but one will fall off in next couple of months anyway, and after learning more about how credit scores are calculated, I think I am better off letting that one fall off vs. paying it and having it show up for ANOTHER 7 years as a slow paid account. (It was a screw up by dental office anyway, but I didn't take steps back then to clear up the issue.) I am torn about whether opening a secure credit card will really improve my score (hovering at 600) enough to warrant the interest and annual charges. Or, should I pay off the one outstanding debt, wait for the other one to fall off, and then try for an unsecured card? I don't "need" to finance anything, but I'm currently considering financing a car. Will that raise my score, or do I really need to get the card sooner versus later? Thanks in advance.

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Don't pay the old debt, it isn't worth it and it won't bring your score up all that much.  (The older a negative account is, the less impact it has on your score.)  If you don't want to do a secured card, you could visit your local credit union and open a "credit builder loan" with them.  I don't think they charge any fees, but it is same type of thing as a secured card.  It will be considered an installment loan instead of revolving credit, but it will still help your score. Any new accounts (i.e. car, credit card, etc.) will raise your score right now (it will drop at first but then improve as you make payments), so go with whichever option you feel most comfortable with.  Best of luck!

Reply by
BluRain13

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Helpful to 1 out of 1 people

Thank you so much!  I will definitely check into that.

Reply by
BluRain13

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Helpful to 1 out of 1 people

Update: Thanks so much for your recommendations. I ended up going to the credit union based on advice received here, but probably would not have done that based on my prior experience.  They approved a loan for me in less than 15 minutes!  I was super excited. Just wanted to thank you again!

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