If you are trying to raise your credit score, applying for a secured credit card is one way to do this. But you may wonder, ‘how much will a secured credit card raise my score?’.
We take a look at how a secured credit card will affect your credit score and how using one can build your credit.

Will A Secured Card Raise My Score?
A secured credit card is one of the ways in which you can increase your credit score. If you have no credit history or a low credit score, this is one of the best ways to improve it.
Of course, the most important thing when using a secured credit card is to make your repayments in a timely manner each month. Making more than the minimum payment each month will also improve your credit score.
You can apply for more than one secured credit card or mix it with other credit applications such as a loan. A good credit mix will improve your credit score as long as you make payments on time.
Another important factor in raising your credit score with a secured credit card is to keep your credit utilization rate low. Ideally, you shouldn’t use more than 30% of your available credit in one month.
How Does A Secured Credit Card Work?
This type of credit card works by depositing a sum of money in the account to which the card is linked. This sum is collateral and acts as security against the activity on the credit card, hence the name.
The credit limit for this type of credit card is set by the amount of deposit you put down. The larger the deposit, the higher your credit limit will be.
If you want to use a secured credit card to improve your credit score, you need to ensure that the issuer is reporting your credit card activity to the credit card bureaus. Failure to report the activity on the account will mean that your credit score will not improve.
Apart from the need for a deposit, a secured credit card is used in much the same way as an unsecured credit card.
How Much Will My Score Increase By?
If you manage your secured credit card well it is possible to increase your credit score substantially in the first twelve months. An increase of 200 points is not out of the question, and there are many ways you can ensure that your credit score goes up.
Of course, it depends on your starting point. If you have no credit score, to begin with, having a secured credit card can mean your credit score will increase very quickly as long as you make your regular payments on time.
A more sedate gain is likely for those with bad credit scores, around 500. Keeping on top of payments and not overusing your credit will help to ensure a steady increase in your credit score.

You will also need to deal with any issues that brought your credit score down in the first place such as poor credit management or late payments.
Building Credit With A Secured Card
A secured credit card is ideal for those who are trying to establish their credit as well as those who are trying to build up their credit.
Many graduates will only have a student loan on their credit report so adding a secured credit card can help improve their credit score. A $500 deposit will get a secured credit card with a $500 credit limit.
By using just under a third of the available credit and making more than the minimum payment each month your credit score will improve noticeably within a few months. After a year of good credit management, your credit score should increase substantially.
Your payment history forms 35% of your credit score. Another important aspect of your credit score is your credit utilization rate. By keeping this low, you improve your chance of raising your credit score.
Things To Consider When Applying For A Secured Card
Think about the reasons why a secured credit card seems like a good idea for raising your credit score. In the majority of cases for someone who has no credit or a bad credit score, it is definitely a good idea.
However, if these things don’t apply to you, then a secured credit card may not really benefit you. This may be the better option if you are eligible for an unsecured credit card. These card accounts are always reported to the credit bureaus while not all secured credit cards are.
For those with bad credit because of high utilization, a secured credit card will help your credit score if you pay down the balances on these other cards first.
You will typically only get a low initial credit limit on an unsecured credit card so if you apply for one in the hope of demonstrating that you can handle large amounts of credit this won’t work.
Will Increasing My Credit Limit Improve My Score?
Increasing your credit limit on a secured credit card can improve your score but only if you are not tempted to increase your credit utilization ratio.
If you increase your credit limit to $1000 from $500 but then use more than 30% of the available credit, this won’t positively affect your credit score. Raising your credit limit won’t necessarily improve your credit score; how you manage your credit counts.
You will also need to demonstrate that you can pay the monthly repayment amounts on increased credit usage.
Final Thoughts
Using a secured credit card is a great way for those with no credit or low credit scores to improve their credit score. By responsibly using a secured credit card, it is possible to increase your credit score over twelve months or less substantially.
We hope you have found this guide helpful.