A Student Credit Card Helps Establish Your Credit
A student credit card allows college students to reap the rewards of possessing a credit card. Student cards offer extra benefits that you may not receive on standard credit cards. Here you can review these benefits and get tips on how to use and manage a student account.
Student credit cards come in all types. There are cards that offer rewards, balance transfers, introductory rates, and even sign up bonuses. So what’s so special about student cards?
Benefits of Student Cards
Credit cards designed for college students are relatively easy to acquire. Due to the fact that most students have little, if any credit history, the approval process is more relaxed than on standard cards. Student credit cards usually have a smaller credit line due to a lack of credit history. The smaller credit line may assist you in budgeting your money and not overspending. Some student cards offer rewards for earning good grades. You may also receive semester based incentives for keeping your account in good standing and paying on time. Check your credit card terms to see if these benefits are available.
Most student credit cards do not require a co-signer. It’s based on your credit history and improves only your credit. Student cards do not usually impose an annual membership fee.
The most prominent disadvantage to student cards is their annual percentage rate. Yes, you may have a low introductory rate, but the standard rate on a student card is anywhere from 15% to 20%. This is where you need to be careful. If you carry a balance on your credit card month to month, you will be paying a large amount of finance charges. It’s always best to pay your account in full each and every month. Don’t begin your credit history on the wrong foot by accumulating more and more debt that you can’t afford to pay. Find the lowest rate student cards.
Another disadvantage is the marketing practices of banks offering student cards. I’m sure you have seen booths set up on your campus offering you a free gift for completing a credit card application. Some students do not understand that they are actually applying for a credit card. They may fill out 2 and 3 applications to get multiple freebies. They then get approved for 2 or 3 cards and deny applying for them or don’t realize that they even have an account until 4 or 5 years later when they pull a copy of their credit report.
Don’t fall into this trap. Multiple inquiries into your credit report can negatively impact your credit history. If you apply for a student card, make sure you keep record of the application, don’t apply for multiple accounts, and watch your mail for the cards after applying.
Begin Your Search
Now that you know some basic information about student cards, begin your search for the perfect card. Do you already have an existing credit card? If you’re looking to transfer your balance from an existing card over to your new student credit card, look no further. Compare student cards that offer a balance transfer option. Of course, if you don’t have an existing account and are looking to obtain one, a student reward card might be in your best interest. This type of credit card gives you rewards for the purchases you make with the card.
Find out what type of rewards you can receive.
What’s the best student credit card? The best student card has many features including an introductory rate on purchases and balance transfers, good grade awards, a reward program, no annual membership fee, and other perks. Do you think there’s a credit card out there that offers all these benefits? Sure there is! Compare Several Student Credit Cards Side By SideFree Student Credit Cards That Offer Cash Back For Your Purchases. If you’re looking for free student credit cards, why not get one that offers you cash rewards? Review several student credit cards that offer cash back here.
Tips for Using Your Credit Card Responsibly
Now that you’re on the search for a credit card, here’s some tips to manage your account responsibly. You’ll find these tips scattered throughout my website on many types of cards, but I want to reiterate how important they are when you are first establishing credit. It’s best to use your credit card just for emergencies. You carry a much lower annual percentage rate on student loans, make sure to use those for your living expenses and tuition.
Avoid taking out cash advances. Cash advances are very costly and may end up costing you as much, if not more, than the amount of cash you took out to begin with. Always pay your balance in full each month. If you can’t afford to pay it in full, pay as much as you can, to avoid a larger amount of finance charges. Avoid making late payments. If you do carry a balance, making a payment late can increase your already high annual percentage rate even more, which costs you more in finance charges than you are already paying.
Good luck locating a student credit card and building your credit! If you have any questions about student cards and credit card management, don’t hesitate to contact me