In today’s financial landscape, building or rebuilding credit can be a challenging journey, especially if you have a limited credit history or have encountered financial setbacks. However, the Navy Federal nRewards Secured Credit Card Review offers a strong solution for individuals in this situation. In this review, we’ll dive into the key features, benefits, and potential drawbacks of this credit card, helping you make an informed decision about your financial future.
Overview of the Navy FCU nRewards Secured Credit Card
If you’re looking to build or rebuild your credit, the Navy Federal Credit Union’s nRewards® Secured Credit Card is a robust option worth considering. This secured credit card stands out in the crowd by offering an opportunity to earn rewards while on your credit-building journey.
The Navy FCU nRewards® Secured Credit Card* stands out as a reliable option in the world of secured credit cards. Unlike many other cards designed for individuals with limited credit, it offers several notable advantages:
No Annual Fee
- Unlike some credit cards that charge an annual fee, the Navy FCU nRewards® Secured Credit Card* keeps your costs low.
No Foreign Transaction or Cash Advance Fees
- Many secured credit cards impose hefty fees for foreign transactions and cash advances. This card, however, spares you from these expenses, making it an attractive choice for international travel and cash withdrawals.
Reward Earning Potential
- One of the standout features of this card is its rewards program. It allows you to earn 1 point per dollar on eligible net purchases. This is a rarity among secured cards, as they typically don’t offer rewards.
Fast Upgrade Paths
- What truly sets the Navy FCU nRewards® Secured Credit Card* apart is its rapid progression from a secured account to partially unsecured and eventually fully unsecured. This feature can help you build credit faster.
Key Card Informations
- Annual Fee: $0
- Regular APR: 18.00% variable
- Credit Score: Bad/Poor
- Finance Devil Score: 4.5 stars out of 5
Pros and Cons
Pros:
- No Annual Fee: The absence of an annual fee means you won’t incur additional costs for holding this card.
- No Foreign Transaction Fees: If you travel internationally, this card won’t burden you with foreign transaction fees.
- Earn 1 Point per Dollar: Earning rewards on a secured card is a rare benefit, and this card allows you to accumulate points on your eligible purchases.
- No Cash Advance Fees: You won’t face cash advance fees, which can save you money in emergencies.
- Your security deposit earns dividends, similar to a savings account.
- Navy Federal reviews your account after three months for potential credit limit increases without requiring an additional deposit and at six months for eligibility for the cash Rewards unsecured card.
Cons:
- Membership Requirement: To access this card, you need to be a member of Navy Federal, which may require a family connection to a veteran or military member.
- Secured Card Deposit: As with all secured cards, you’ll need to make an initial deposit.
- A minimum deposit of $200 may be challenging for individuals with limited credit history.
- Some other secured cards offer more generous rewards rates and more flexible redemption options.
- You must open a Navy Federal savings account and deposit $200 into it before applying.
Other Cardholder Benefits
- Cell Phone Protection: Your Navy Federal Credit Card can provide extra protection for your cell phones.
- No cash advance fees, balance transfer fees, or annual fee.
- Points redeemed for cash, statement credit, gift cards, and merchandise.
- Tap to Pay: Make purchases quickly and securely with your nRewards card.
For individuals without a credit history or those who have experienced credit challenges, secured credit cards like the Navy FCU nRewards® Secured Credit Card* can be a lifeline to better credit prospects. These cards require a deposit, which serves as collateral for the bank to extend credit to you. The credit limit is typically based on the amount of your deposit, making it accessible to those with limited or poor credit. One of the significant advantages of a solid secured card like the nRewards Secured Card is that it reports your credit payment behavior to the major credit bureaus, allowing you to showcase responsible credit usage.
Beyond the foundational benefits of building credit, the Navy FCU nRewards® Secured Credit Card* goes a step further. It distinguishes itself from many unsecured cards for individuals with limited credit history in two critical ways:
- 1. No Foreign Transaction or Cash Advance Fees: While other cards often impose substantial fees for foreign transactions and cash advances, this card provides relief by eliminating these charges.
- 2. Rewards Earning: This card allows you to earn rewards, an unusual feature among secured cards. You’ll earn 1 point per dollar spent on eligible net purchases, which can be redeemed for merchandise, gift cards, or cash back. The card requires a minimum initial deposit of $200.
The Navy FCU nRewards® Secured Credit Card* goes beyond traditional secured cards by offering additional benefits. It stands out for not charging an annual fee, balance transfer fees, foreign transaction fees, or cash advance fees. Moreover, it boasts a competitive regular APR of just 18 percent variable, a favorable rate for a credit-building card.
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While this card is an excellent choice for credit builders, it’s essential to explore other options available in the market, as some may offer better rewards rates, more flexible redemption choices, or even welcome offers. Keep in mind that only Navy Federal Credit Union members can apply for this card, which requires a connection to the military, either as a service member or an immediate family member.
Fast Credit Line Growth
Another appealing aspect of the Navy FCU nRewards® Secured Credit Card* is its rapid credit line growth. After just three months of responsible card use, you can be considered for a higher credit limit beyond your initial deposit. At the six-month mark, regular evaluations commence, potentially allowing you to upgrade to an unsecured cashRewards card.
While some cards might offer more lucrative rewards, certain benefits of the Navy FCU nRewards® Secured Credit Card*, such as the absence of cash advance fees and secondary car rental insurance, are rarely found among cards designed for those with limited or damaged credit.
Membership Requirement
It’s essential to note that membership in Navy Federal is a prerequisite for obtaining this card. However, joining Navy Federal may be easier than you think. Eligibility extends to family connections with veterans or military members, encompassing grandparents and grandchildren.
Quick Overview
- No Annual Fee
- No Foreign Transaction Fees
- No Cash Advance Fees
- Earn 1 point per dollar on eligible net purchases
- Secured card with deposit required
- Navy Federal credit union membership required
Navy Federal nRewards Secured Credit Card Rewards
Earning Rewards
The Navy FCU nRewards® Secured Credit Card* offers 1 point per dollar on eligible net purchases. There’s no cap on the rewards you can earn. It’s important to note that points aren’t earned if your account falls into bad standing, and points expire four years after the month in which they were earned.
Redeeming Rewards
Points can be redeemed for merchandise, gift cards, or cash back. Each point has a cash-back value of 1 cent. Redemption must be in multiples of 5,000 points (e.g., 5,000 points for $50, 10,000 points for $100, 15,000 points for $150, and so on). You can redeem points for cash back, statement credits, or deposits into your Navy Federal Credit Union account.
Rewards Potential
To gauge the rewards potential of the Navy FCU nRewards® Secured Credit Card*, let’s consider the average spending of an American household on a credit card annually. Based on data from various government agencies, a typical American household incurs $28,431 in expenses that can be reasonably charged to a credit card. If you put all your spending on this card, you could earn 28,431 points per year, assuming you have a relatively high deposit, as this is a secured card. These points could translate into $284.31 in cash back.
However, the actual redemption potential depends on your security deposit and credit limit. For instance, if you make the minimum deposit of $200, the most you could earn annually with this card would be 2,400 points ($24), provided you max out your credit limit each month. Even with a $1,000 deposit, earning 3,600 points ($36) in a year would be possible only if you maintain your credit utilization at 30% or lower. Keep in mind that the card’s minimum redemption threshold is 5,000 points.
For individuals who responsibly manage the Navy FCU nRewards® Secured Credit Card, there’s the potential for Navy Federal Credit Union to upgrade them to an unsecured version of the card with a higher credit limit and, consequently, more rewards potential. However, until that point, your primary focus should be on building your credit score, as the rewards may be relatively modest.
Is the nRewards Secured Card Worth It?
The Navy Federal nRewards Secured card is a valuable tool for military members and their families seeking to build or rebuild their credit. Its unique feature of offering rewards on all purchases sets it apart from most secured cards. However, it’s crucial to recognize that the primary objective of a secured card should be responsible credit use and credit score improvement.
While this card is certainly worth considering, especially if you are stationed overseas, other secured cards with more lucrative rewards may be appealing. Remember that building good credit habits, such as making on-time payments and keeping credit utilization low, should be your top priority.
Other Navy Federal nRewards Secured Credit Card Benefits
In addition to the aforementioned advantages, the Navy FCU nRewards® Secured Credit Card* offers other noteworthy benefits:
- Collision Damage Waiver: Provides secondary rental car insurance coverage for short-term car rentals in case of damage or theft.
- $0 Fraud Liability: You won’t be held responsible for unauthorized charges.
- FICO Score Access: Regular access to your credit score.
- 24/7 Access and Fraud Monitoring: Receive alerts and have access to assistance around the clock.
- Account Reviews at Three and Six Months: After three months of card ownership, Navy Federal Credit Union conducts an account review to determine if you’re eligible for a credit limit increase without requiring an additional deposit. This flexibility helps you manage your credit utilization effectively. At six months, another review takes place, potentially paving the way for an upgrade to the cashRewards unsecured card.
Rates and Fees
Unlike some secured credit cards that impose annual fees, processing fees, or both, the nRewards Secured card follows a no-fee structure. To open this card, Navy Federal Credit Union members only need to establish a savings account with a minimum $200 security deposit, which sets your credit limit at the same amount.
Lower fees are crucial because any upfront costs can diminish your purchasing power and impact your credit utilization ratio. This card’s fee structure increases your chances of using your credit line responsibly, aiding in building a stronger credit profile over time. Additionally, it does not charge foreign transaction fees, which is advantageous for Navy Federal members stationed overseas.
However, it’s important to be aware of penalty fees for late and returned payments, which can reach as high as $20.00. Nevertheless, the nRewards Secured card aligns with many essential factors to consider when evaluating secured credit cards.
Footnote
Interest Rates
- Regular APR: 18.00% variable
- Purchase Intro APR: N/A
- Balance Transfer Intro APR: N/A
Fees
- Annual Fee: $0
- Balance Transfer Fee: N/A
- Foreign Purchase Transaction Fee: None
How the Navy Federal nRewards Secured Credit Card Stacks Up
Navy FCU nRewards® Secured Credit Card vs. Discover it® Secured Credit Card*
While the Navy FCU nRewards® Secured Credit Card* offers many advantages, it’s essential to compare it to other options in the market. One such alternative is the Discover it® Secured Credit Card. While Discover isn’t as widely accepted internationally, this card has its own set of perks:
Advantages:
- Earn 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter.
- Earn unlimited 1% cash back on all other purchases.
- Discover Cashback Match doubles all cash back earned during the first year for new cardholders.
The Discover it® Secured Credit Card closely matches the Navy FCU nRewards® Secured Credit Card* in several respects, but the choice between them depends on your individual priorities regarding rewards and specific benefits.
Navy FCU nRewards Secured card vs. Capital One Platinum Secured Credit Card:
- The Capital One Platinum Secured Credit Card allows cardholders to open an account with just a $49 deposit, potentially more accessible for those with limited funds compared to the nRewards Secured card’s $200 minimum deposit.
- Both cards have no annual fees or foreign transaction fees, making them suitable options for military members stationed overseas.
- The nRewards Secured card offers quicker credit limit increase reviews at three months, while the Capital One Platinum Secured card reviews at six months.
- After six months with the nRewards card, Navy Federal may offer you the opportunity to upgrade to an unsecured card and return your initial deposit.
Navy FCU nRewards® Secured Credit Card vs. Petal® 1 “No Annual Fee” Visa® Credit Card*
For individuals with limited credit history but responsible financial habits, the Petal 1 Visa, issued by WebBank, presents an interesting alternative. It evaluates credit based on your “Cash Score,” considering your banking and financial history. The Petal 1 offers an unsecured card with credit limits ranging from $300 to $5,000, depending on your financial credit evaluation. While the cash-back rates may not be substantial, the absence of a deposit requirement distinguishes the Petal 1 from other cards in the credit-building landscape.
Comparing the Navy Federal nRewards Credit Card With Other Cards
Navy FCU nRewards® Secured Credit Card
- Welcome Bonus: N/A
- Annual Fee: $0
- Credit Score: Bad/Poor
- Regular APR: 18.00% variable
Discover it® Secured Credit Card
- Welcome Bonus: Cashback Match™
- Annual Fee: $0
- Credit Score: New/Rebuilding Credit
- Regular APR: 28.24% Variable APR
Petal® 1 “No Annual Fee” Visa® Credit Card
- Welcome Bonus: N/A
- Annual Fee: $0
- Credit Score: Fair/No Credit
- Regular APR: 25.24% – 34.74% Variable
Best Cards to Pair With the nRewards Secured Card
Pairing a secured card with another credit card can be a strategic move to enhance your overall credit profile. Since secured cards typically have lower credit limits based on the deposit, finding a card that complements your credit-building efforts is essential.
The goal is to maximize your total available credit across all cards, which can help maintain a healthy credit utilization ratio. This ratio is a key factor in your credit score. Therefore, consider applying for a credit card with a higher credit limit, preferably one that aligns with your creditworthiness and financial situation. However, always prioritize responsible credit use over accumulating multiple credit cards.
Is the Navy Federal nRewards Secured Credit Card for You?
The Navy Federal nRewards Secured Credit Card is a compelling choice for individuals seeking to improve their credit profiles, especially if they have encountered credit challenges in the past. While its cash-back rewards may not be the most lucrative among secured cards, the added perks such as car rental insurance set it apart. Additionally, the absence of foreign transaction fees and cash advance fees makes it an attractive option for those who qualify for Navy Federal Credit Union membership.
It’s important to remember that the information provided here is for informational purposes only and is not a substitute for financial advice. Be sure to carefully review the terms and conditions of any credit card before applying, and consider your individual financial situation and goals when making your decision.
FAQs (Frequently Asked Questions)
How can I become a member of Navy Federal Credit Union?
- To join Navy Federal, you need a family or household connection to a veteran or military member. This includes relationships with grandparents and grandchildren.
Is there a limit to the rewards I can earn with the Navy FCU nRewards Secured Credit Card?
- There is no limit to the rewards you can earn, provided your account remains in good standing.
How do I redeem the points I earn with this credit card?
- You can redeem your points for merchandise, gift cards, or cash back. Redemption must be in multiples of 5,000 points.
Can I upgrade to an unsecured card with Navy Federal?
- Yes, after a certain period of responsible card use, you may be eligible for an upgrade to an unsecured card with a higher credit limit.
What sets the Navy Federal nRewards Secured Credit Card apart from other secured cards?
- This card distinguishes itself with its absence of foreign transaction and cash advance fees, along with its rewards program, which is rare among secured cards.
To Recap
The Navy FCU nRewards Secured Credit Card offers a pathway to better credit and financial stability for those who need it most. While it may not have the flashiest rewards, its practical benefits, combined with the opportunity for credit growth, make it a valuable tool for credit building and financial recovery.
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