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If you’ve recently lost your job, your financial situation is likely a concern. It could be even more so if you’ve been unemployed for a while. Relying on unemployment insurance and your savings could help you get through a period of joblessness. But a credit card may be another option for your financial tool kit, if used wisely. Here’s what to know about getting a credit card with no job.
Should you get a credit card with no job?
Before applying for a credit card, assessing your current financial circumstances and how you plan to use the card is important. If, for example, your situation is dire and you’re having trouble covering costs, a credit card might not be the best solution. Credit cards have some of the highest interest rates around, so accumulating debt on a new card to cover expenses could make your circumstances even more dire.
But in some cases, getting a credit card with no job could make sense. For instance, if your goal is to build credit, a secured credit card could be a good option.
And if you have great credit and savings to cover your costs, consider a 0% introductory APR credit card. This type of card gives you a reprieve from paying interest for a set period, often 12 to 18 months (you’ll still need to make minimum payments during that time). But if your financial situation is dire, a 0% intro APR card may not be the best choice, as the card’s regular interest rate will kick in after the intro period. This could be problematic if you carry a significant card balance.
Can you get a credit card with no job?
It’s possible to get a credit card with no job, though the credit card company will consider your income when deciding if you’re approved. While your income may include your individual earnings, it can also include your household income, investment returns, payments from Social Security, and unemployment insurance compensation, if you’re receiving it.
Beyond income, credit card issuers will look at your credit history and current debts before approving you for a new card. Past credit issues and high levels of debt relative to your income could present significant roadblocks. But if you have great credit and manageable debt, that’ll likely work in your favor.
4 options if you can’t qualify for a credit card with no job
Consider these alternatives if you’re concerned you can’t qualify for a traditional credit card due to a lack of income or for another reason.
1. Authorized user card
You could become an authorized user on someone else’s credit card, typically that of a trusted relative or friend. Authorized users don’t need to qualify for a card on their own, and, instead, are authorized to spend on their trusted relative or friend’s card. Keep in mind that you’ll need to be responsible for making payments to the primary cardholder if you plan to use their card. Responsible card use could mean a boost to your credit score.
2. Secured credit card
A secured credit card could be another option if you can’t qualify for a traditional credit card. Secured credit cards require a security deposit that serves as your credit limit and used to build credit.
3. Alternative credit card
An alternative credit card, such as the Petal 1 card, gives you access to credit, and you won’t need to pay an annual fee or security deposit. That said, your credit limit will likely be fairly low, and the card’s variable APR is very high compared to more traditional credit cards.
4. Cosigned credit card
While most major card issuers don’t permit using a cosigner for a credit card, some smaller issuers may. A cosigner is generally a friend or family member with good credit who cosigns your credit card application and agrees to take on your payments if you default. They assure the credit card company that someone will be responsible for your balance if you can’t pay.
The bottom line
Getting a credit card with no job is possible, but it’s important to consider your situation and goals before applying. If you plan to use the card to cover essential expenses and are in dire financial circumstances, a new card may not be the best choice. But it could be a good option if you want to build credit or can qualify for a card with a 0% introductory APR and pay it off before the promotional period ends. If not, it’s wise to consider an alternative.
Editorial Disclosure: The information in this article has not been reviewed or approved by any advertiser. All opinions belong solely to the Yahoo Finance and are not those of any other entity. The details on financial products, including card rates and fees, are accurate as of the publish date. All products or services are presented without warranty. Check the bank’s website for the most current information. This site doesn't include all currently available offers. Credit score alone does not guarantee or imply approval for any financial product.
