Kikoff Credit Account vs Self Credit Builder + Secured Visa

2 Different Credit Builder Products Compared

Many of you are looking to compare the Kikoff Credit Account against the Self Credit Builder and Secured Credit Card. To be upfront, this is like comparing apples to oranges. They are credit builder products. But aside from the fact that they both do not check your credit when you apply, they are really different types of credit builders. As we will see later, it does not mean one is better than the other. In fact, you can get both. At the end of the comparison, you will get a better understanding on both Kikoff and Self and when you should get either one.

The Basics

Kikoff Credit Account

The Kikoff Credit Account is an online store that gives you an unsecured credit of $500, which you can use to purchase from it. They sell financial and wellness ebooks that cost $10. Because of the low cost of their products, Kikoff does not check your credit when you apply and you will definitely be approved. There is a monthly membership fee of $2/month and it is renewed every 12 months. Kikoff reports to both Experian and Equifax and also provides a free Vantage 3.0 Credit Score Score from Equifax. They also do not charge any interest when you make a purchase on the account so that APR is 0%.

Self Credit Builder + Secured Visa Basics

The Self Secured Visa is for those who want a secured credit card but cannot afford to fund their security deposit. Self offers a way out by their credit builder loan. Unlike a traditional loan where the loan amount is deposited in your checking account, with a credit builder loan, you do not get to see the loan amount at all. Instead, you simply pay back the loan with interest every month. That cash (excluding interest) is deposited into the credit builder account and it increases over time as you "pay back your loan" and "save". Because it is technically a loan, your payments are reported to the three major credit bureaus. And because the loan amount is not given to you, Self does not check your credit when you apply for their credit builder loan because the risk is absolutely minimal to them and they only risk you not paying the monthly payment.

With the Self Credit Builder, you choose the payment amount (the minimum monthly payment is $25) rather than the loan amount and the loan maturity is 24 months. After you have paid back $100 (and made a minimum of 3 payments of at least $25), you can then set up your secured credit card account. You can transfer money from your credit builder account into the secured account, which becomes your security deposit and your credit limit. The minimum security deposit amount is $100. Self only allow you to fund your security deposit only once so you have to be sure what credit limit you want in your secured card before you transfer the amount over. There is no second chance to add more security deposit at a later date. Like the Credit Builder Loan, there are no credit checks if you get the secured Visa card.

Similarities

• No Credit Checks - Both the Kikoff Credit Account and Self Credit Builder and Secured Credit Card do not perform any credit checks and you will definitely be approved.

Differences

• Fundamentally Different Products - Both Kikoff and Self and fundamentally different products. Kikoff is an online store card while Self is both a credit builder loan and secured credit card.


• Differences in APR - Kikoff does not charge any interest rate (ie 0% APR), while the Self Secured Visa has a regular purchase APR.


• Store Card vs Visa - With Kikoff, you can only use it to buy products from their online store whereas the Self Secured Visa can be used anywhere Visa is accepted.

Which is better? Wrong Question

As both Kikoff and Self are different, saying which is better is really irrelevant. One thing is very clear though. As a rebuilder, secured credit cards are one of the most cost effective way to start rebuilding your credit. However, they require you to put down a security deposit (which becomes your credit limit). Some of you may not have enough to fund a security deposit at the moment and need to save up. Self offers those in this situation to save up for their security deposit while rebuilding their credit.

I see Kikoff more as a tool to get once you have a secured credit card under your belt. You can then add an additional trade line to your credit report and increase your overall credit limit and most like improve your credit utilization ratio. Sure, you could get it as your first rebuilding tool. But you can only use it at their online store and not at regular places. This is important because you probably need a Visa or Mastercard for things like filling up your gas, renting a car and booking airlines. Even Uber only accepts credit cards.

To sum, both Kikoff and Self are great tools for rebuilders. If you are looking for a secured credit card but do not have enough to fund a security deposit at the moment, then the Self Credit Builder can be used to bridge the gap until you have saved up enough for the Self Secured Visa. If you already have enough to fund a security deposit, then you obviously can consider secured credit cards. Kikoff is useful if you feel you need to add a tradeline to your credit report and increase your credit utlization ratio.