Building credit is important, especially if you want to qualify for an auto loan or home loan later down the road. There are different ways to build credit, one of those being by getting a secured credit card. A secured credit card is an effective way to build credit. All you have to do is put down a deposit with the lender and the amount of money that you put down becomes the credit line for the account.

For example, if you put down a $200 deposit, your credit limit on the card will be $200. You can use it just like any other card and if you fall behind on your payments, the lender will use your security deposit to pay off your balance.