If you’re currently without a job — either temporarily or permanently — you may be wondering: ‘Do you need a job to get a credit card?’ While the answer will depend on your unique financial situation, know that it is possible to get a credit card with no job.
But even if you can get a credit card with no job, there are potential risks in borrowing money without a steady source of income. Here’s how you can get a credit card with no job, as well as the pros and cons to consider before you do.
Can You Get a Credit Card With No Job?
If you don’t have a full-time or regular job, you may still be able to get approved for a credit card. However, you may need to show other means of being able to pay your credit card obligations due to how credit cards work.
When applying for a credit card, credit card issuers are required to consider your ability to repay your debts when considering whether to approve your application. To determine whether you meet this credit card requirement, they’ll typically look at your income from a job or other sources. If you’re attempting to get a credit card with no job, this could include unemployment benefits, self-employment income, shared household income or retirement income.
What Does the Credit Card Act of 2009 Say?
The Credit Card Accountability Responsibility and Disclosure Act of 2009 (also known as the Credit CARD Act) is the federal law that governs many interactions between credit card issuers and applicants. One thing that the Credit Card Act of 2009 did was prevent credit card companies from issuing new cards to applicants under 21 years of age unless they have an adult cosigner or have proof of income. This makes it more difficult for young adults without a job to get their own credit card.
Guide to Listing Income on Your Credit Card Application
One of the biggest credit card rules is that you should always be completely truthful on your credit card application. If you don’t have a job or income, you should state that rather than inflating or lying about your total income.
If your issuer finds out that your application was not completely accurate, they may close your account. In turn, this could damage your credit.
Types of Income That You Can Report on a Credit Card Application
Now that you know the answer to the question, ‘can you apply for a credit card without a job?’, you’ll need to know how to fill out your application. You can use a variety of different types of income on your credit card application. Here are a few of the most common:
• Employment income: Money you earn from employment is the most common source of income on credit card applications. This can include money from a seasonal or irregular job.
• Self-employment income: If you have your own business, you can also include that on a credit card application. This can include money from contract or freelance work.
• Unemployment benefits: Another potential source of credit card application income is unemployment benefits. If you’re temporarily out of work and receiving unemployment insurance benefits, you can include that on a credit card application.
• Shared household income: The Credit CARD Act of 2009 states that you can include as income any money that you would reasonably expect to have access to. This could include a spouse’s income or an allowance provided by a family member.
• Retirement income: Retirement benefits like a pension or Social Security are also considered an acceptable form of income for credit card applications. This also includes distributions from a retirement account.
Guide to Getting a Credit Card With No Job
If you don’t have a job and your other sources of income aren’t enough to get a standard credit card, then you do have a few other options you can consider.
Opt for a Secured Card
One option to consider is applying for a secured credit card. With a secured credit card, you generally make a refundable initial deposit. This deposit then serves as your total credit line. It is generally easier to get approved for secured credit cards than traditional, or unsecured, credit cards.
Become an Authorized User
Another possibility is to become an authorized user on a credit card. When you’re an authorized user on someone else’s account, only the primary account holder is legally and financially responsible for all purchases on the account. And if the primary account holder uses the card responsibly, it can help raise your credit score, even if you’re only an authorized user.
Consider a Cosigner
If you have a trusted friend or family member, you might also look at getting a credit card cosigner. Some credit card companies may not approve you for a new credit card on your own, but they may approve you if you have someone who will co-sign your application.
Keep in mind that a cosigner will be legally and financially on the hook for your purchases, so it may be difficult to find someone willing to cosign for you.
Look Into a Student Credit Card
Many card issuers offer a type of credit card marketed toward students. If you’re a student with a limited credit history and no income, you may stand a better chance of getting approved for a student credit card than a traditional credit card. Plus, these cards may have low fees and offer rewards tailored to students’ typical spending habits.
Pros and Cons of Getting a Credit Card When Unemployed
It is possible to get a credit card if you’re unemployed since you can list unemployment benefits, among other income sources, in your application. While there are certainly upsides to securing a credit card, you should carefully consider the downsides as well before applying for a credit card without a job.
|Responsibly using a credit card can help improve your credit score||It may be difficult to get approved|
|Having a credit card makes it easier to make some types of purchases||If you are approved, you may not be approved for a very high credit limit|
|You may earn rewards and/or cash back with your credit card purchases||You may have trouble repaying your purchases without a steady source of income|
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Tips for Using a Credit Card Without a Job
While the answer to whether you have to have a job to get a credit card is technically no, there are some caveats attached to swiping your card without a steady income. Still, just because you don’t have a job doesn’t mean you can’t build your credit in your meantime. Here are some tips to keep in mind to use your credit card wisely:
• Shop around for a card with a competitive rate: Especially if your financial situation has some uncertainty, you may end up carrying a balance at some points. To avoid paying any more than you need to in interest, make sure to take your time to shop around for the card that offers you the lowest rate.
• Don’t spend more than you can afford to pay back: Before you use your credit card for any purchases, make sure that you’ll have the money to pay your bill off at the end of the month. If you won’t, you may need to reevaluate your overall spending habits to make sure you don’t fall into debt.
• Pay each month in full to save on interest: One of the best things that you can do for your overall financial health is to reliably pay your bills in full, each and every month. If you do this, you won’t end up paying interest on your purchases.
• Set alerts so you don’t miss your monthly payments: If you’re already tight on funds because you’re without a job, the last thing you want to deal with is late fees. Plus, aside from this cost, your credit score will also suffer. To make sure you remember to make payments on-time, consider setting an alert to remind yourself, or even autopay.
It is possible to get a credit card with no job, but it may not be easy. And many premium or luxury credit cards may not be available to you. Make sure to account for all sources of income on your credit card application. Remember that in addition to income from employment, you can consider other forms of income like self-employment, retirement, or household income. Alternatively, you can consider options like a secured card, a student card or becoming an authorized user on someone else’s account.
If you do have good credit and a reliable source of income, you might consider the SoFi credit card. The SoFi Credit Card offers unlimited 2% cash back on all eligible purchases. There are no spending categories or reward caps to worry about.1
Can you get a credit card if you have no income?
Yes, it is possible to get a credit card if you have no income, but it may not be easy. Credit card issuers are required to consider your ability to pay your bills before approving you for a card. Keep in mind that you can use more than just money from employment as income. You can also use retirement, self-employment, or shared household income.
Do credit card companies know if you are unemployed?
Credit card companies do not directly know if you are unemployed, but your employment status is usually asked as a question on most credit card applications. However, if you already have a credit card account and then later become unemployed, that information is not generally shared directly with your credit card company.
Can you get a credit card when you’re on unemployment benefits?
Yes, it is possible to get a credit card if you’re on unemployment benefits. Credit card companies are legally required to consider your ability to pay all of your bills when deciding whether to approve you for a card. But this consideration can include income from many sources, not just income from employment.
What is the minimum income required to get a credit card?
There is not a set minimum income credit card requirement. Instead, different credit card issuers will consider your overall financial situation (including income) when deciding whether to approve you for one of their cards. While it is possible to get a credit card with no or low income, you may not be able to get approved for all credit cards.
Does unemployment affect credit?
If you lose your job and start receiving unemployment benefits, it won’t directly affect any credit cards that you already have. However, if your job loss starts to impact your ability to make your payments on-time, your credit card issuer may charge fees and/or raise your interest rate.
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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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