Getting a best credit card as a college student gives you an opportunity to get a high-quality card with little or no credit history, as well as a chance to build credit before you leave school.
A student credit card is a great first step in establishing a good credit history. Building good credit might not seem like a priority when you're still in school, but you'll need it down the road if you want to finance a car, buy a house or qualify for the best credit card offers.
These cards usually offer low credit limits, and most don't charge annual fees.
Be aware that simply being a college student may not be enough to qualify you for a “student” card. You’ll generally need access to income, and if you have shaky credit or no credit history at all, you may find it hard to get approved. In that case, consider a secured credit card.
Our editors analyzed 10 best credit cards for college student to bring you our recommendations – here are the best student credit cards from our partners to kick off the school year.
What are student credit cards?
Student credit cards are designed for people with limited credit history and it’s a way to build your credit while in school. Student credit cards differ from regular credit cards in a couple ways. For example, unlike most rewards cards, student cards may not have sign-up bonuses. Also, the required credit will usually be lower for a student card, as well as the credit limit. Finally, student cards will sometimes have special features specific to the needs of college students.
The specific features of student cards can vary greatly. For example, only 2 of the 11 student cards we surveyed offered a bonus worth more than $200, and one had a $50 sign-up bonus.
Still not sure why you should get a credit card? Because of the way scoring models are set up, the easiest way to build credit is with a credit card. In addition, credit cards are safer than debit cards because of federal protections that are in place.
How do student credit cards work?
Here we’ll look at how to get your first credit card and how to understand the features of the card:
How to get your first credit card
When you’re ready to get your first credit card, do your homework. Check your credit reports, find your credit score, and research cards that fit your needs. There are a number of student credit cards available, most with unique features and conditions. Take special notice of annual fees, rewards offered, and APRs.
Narrow your selection and apply to only one card. Every time you apply for a credit card (this is called a “hard pull”), it’s noted on your credit report. Multiple applications can negatively impact your credit score and make it more difficult to get approved for a card.
The best credits cards for first-timers and students with a limited credit history
WHY WE CHOSE THIS:
· Earns 3% cash back in a category of your choice
· Offers a 12-month 0% APR on purchases and balance transfers
· Charges no annual fee
HIGHLIGHTS
· 3% cash back in the category of your choice: gas, online shopping, dining, travel, drug stores, or home improvement and furnishings, 2% cash back at grocery stores and wholesale clubs and 1% cash back on all other purchases.
· You’ll earn 3% and 2% cash back on the first $2,500 in combined choice category/grocery store/wholesale club purchases each quarter, then earn 1%.
· Enjoy no annual fee while choosing how you earn rewards and getting on the path to building your credit.
· Winner: Bank of America – MONEY ‘Best Bank for College Students’
· Easily manage your bank accounts and finances online with Online Banking and our award winning Mobile Banking App that help students stay in control of their finances and make payments.
· Now, you can access your FICO Score updated monthly for free, within your Mobile Banking app or in Online Banking. Opt-in to receive your score, the key factors affecting your score, and other information that can help you keep your credit healthy.
· Online $200 cash rewards bonus after making at least $1,000 in purchases in the first 90 days of your account opening.
RATES & FEES
· Issuer Name | Bank of America |
· Credit Needed | New to credit |
· Annual Fee | $0 |
· APR | 13.99% to 23.99%, based on your creditworthiness |
· Penalty APR | Up to 29.99% |
· Purchase Intro APR | 0% Introductory APR on purchases for 12 billing cycles |
· Balance Transfer Fee | $10 or 3% of the amount of each transaction, whichever is greater |
· Balance Transfer Intro APR | 0% Introductory APR for the first 12 Statement Closing Dates following the opening of your account for transactions made within 60 days of opening your account |
· Cash Advance Fee : Direct Deposit and Check Cash Advances: Either $10 or 3% of the amount of each transaction, whichever is greater ATM, Over-the-Counter, Same-Day Online and Cash Equivalent Cash Advances: Either $10 or 5% of the amount of each transaction, whichever is greater Overdraft Protection Cash Advance: $12 for each transaction
· Foreign Transaction Fee: 3% of the U.S. dollar amount of each transaction (1) made in a foreign currency, or (2) made in U.S. dollars if the transaction is made or processed outside of the United States
#2 Bank of America® Travel Rewards for Students
Bank of America is one of the few card issuers that allows co-signers, who can be a parent, guardian -- or anyone with a good credit score who's willing to share the legal liability. On the other hand, any late or missed payments or high outstanding balances will also negatively affect the co-signer's score
· Standard APR: 14.99% to 22.99% variable
· Penalty APR: Up to 29.99%
· Late payment fee: Up to $40
· Annual fee: $0
· Cash-back rewards: 1.5% on all purchases
· Foreign transaction fee: 0%
· Eligibility requirements: Allows co-signers
WHY WE CHOSE THIS CARD:
With no annual fee, no fee for making transactions in another country, and the wide reach of the Visa card network, the Bank of America Travel Rewards for Students card is a no-brainer for students planning to spend time outside the U.S. The flat rewards-earning rate makes it simple to get points on everyday spending, no matter where you are.
HIGHLIGHTS:
· Earn 25,000 points if you make at least $1,000 in purchases in the first 90 days of your account opening.
· Earn unlimited 1.5 points for every $1 you spend on all purchases everywhere, every time and no expiration on points.
· Preferred Rewards members earn 25%-75% more points on every purchase That means you could earn up to 2.62 points for every $1 you spend, everywhere, every time.
#2 Journey Student Rewards from Capital One
HIGHLIGHTS:
· Earn 1% cash back on all your purchases. Pay on time to boost your cash back to a total of 1.25% for that month
- Earn 1% cash back on all your purchases. Pay on time to boost your cash back to a total of 1.25% for that month.
- $0 annual fee.
- With Credit Steps your account will be reviewed for a credit limit increase after making your first 6 monthly payments on time.
- Enjoy unlimited access to your credit score and tools to help you monitor your credit profile with CreditWise.
· Earn $5 per month for 12 months on Select Streaming Subscriptions when you pay on time. *Exclusions Apply
· Enjoy no annual fee and no foreign transaction fees
· You can help build your credit with responsible use of a card like this
· Pick the monthly due date that works best for you
· Be automatically considered for a higher credit line in as little as 6 months
· $0 fraud liability if your card is ever lost or stolen
· Monitor your credit profile with the CreditWise® app, free for everyone
Rates & Fees
Annual Fee: $0
Intro Purchase APR: N/A
Regular APR: 26.99% (Variable)
Intro Balance Transfers APR: N/A
WHY WE CHOSE THIS CARD:
The Journey Student Rewards from Capital One offers simple rewards, with a bonus for paying on time. You don’t even have to be a student to apply, so consider it if you have average credit.This card has a great combination of simple rewards and credit-building tools. You can get a higher credit limit after making your first six monthly payments on time, and as long as you keep your balance low, the extra available credit can help improve your credit score. Making on-time payments also lets you earn higher rewards that month—1.25% cash back on your purchases, instead of the standard 1%. You can track how these good behaviors affect your credit score using Capital One's CreditWise tool.
#3 Discover it® Chrome for Students
The Discover It Student Chrome offers a winning combination of cash back and other rewards as well as lenient terms for first-time credit card holders. You won't get dinged by the credit card company for a late payment -- at least the first one -- or have to deal with an exorbitant penalty APR. And, of course, getting 1 to 2% back in rewards each month is a welcome bonus. Note that Discover offers another similar student credit card, the Discover It Student Cash Back credit card, but the rotating bonus categories make things overcomplicated, especially for first-time cardholders.
HIGHLIGHTS
· INTRO OFFER: Unlimited Cashback Match - only from Discover. Discover will automatically match all the cash back you've earned at the end of your first year! So you could turn $50 cash back into $100. Or turn $100 into $200. There's no minimum spending or maximum rewards. Just a dollar-for-dollar match.
· Earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. Plus, earn unlimited 1% cash back on all other purchases - automatically.
· Good Grades Rewards: $20 statement credit each school year your GPA is 3.0 or higher for up to the next 5 years.
· Earn rewards while building your credit history that can help you after graduation. And, get your free Credit Scorecard that includes your FICO® Credit Score and important details that help make up your score.
· No annual fee. No late fee on first late payment. No APR change for paying late.
· Refer-a-Friend: Once you become a Discover it® Student cardmember, you can earn a statement credit each time you refer a friend and they're approved. Over half a million students got Discover Cards from their friends' recommendations.
· Freeze It® on/off switch for your account that prevents new purchases, cash advances & balance transfers in seconds.
· Get an alert if we find your Social Security number on any of thousands of Dark Web sites.* Activate for free.
· Discover is accepted nationwide by 99% of the places that take credit cards.
· 0% intro APR on purchases for 6 months, then the standard variable purchase APR of 12.99% - 21.99% applies.
· Standard APR: 17.99% variable (0% for the first 6 months)
· Penalty APR: None
· Late payment fee: Up to $40
· Annual fee: $0
· Cash-back rewards: 2% on gas and dining, up to $1,000 in combined purchases each quarter; 1% on all other purchases
· Foreign transaction fee: 0%
· Standout feature: No late fee for first late payment
· Eligibility requirements: No credit history required, proof of income
HIGHLIGHTS
· Build credit history while you’re in college
· 3% cash rewards earned for up to $2,500 spent on gas, grocery, and drugstore purchases for the first 6 months. Enjoy 1% cash rewards for other purchases
· No annual fee
· Low intro APR helps you buy what you need while in college
· Flexibility to use cash rewards toward travel, gift cards, merchandise, cash redemption options, and more.
· Access your FICO Credit Score, credit education and tools with Wells Fargo Online
WHY WE CHOSE THIS CARD:
We love this card for its consistent 1% cash-back reward rate, bonus rewards during your first six months, and a relatively low APR. There’s a nice little 0% purchase APR promotion for new cardholders, too. You can earn 3% cash back on up to $2,500 of gas, grocery, and drugstore purchases during your first six months with the card, and 1% back on everything else. While this card has a relatively low ongoing APR, paying double-digit interest rates on debt will hurt, so avoid carrying a balance if possible. Note: You must have an existing bank account at Wells Fargo to apply online.
RATES & FEES
· Issuer Name : Wells Fargo
· Credit Needed: New to Credit
· Annual Fee: $0
· APR: 11.15% to 21.15%, based on your creditworthiness
· Penalty APR: None
· Purchase Intro APR: 0% introductory APR for 6 months
· Balance Transfer Intro APR:0% introductory APR for 6 months
· Balance Transfer Fee: Introductory fee of either $5 or 3% of the amount of each balance transfer, whichever is greater, for 120 days from account opening. After that, up to 5% for each balance transfer, with a minimum of $5.
· Cash Advance Fee: Either $10 or 5% of the amount of each advance, whichever is greater
· Foreign Transaction Fee: 3% of each transaction converted to U.S. dollars
#5 Secured MasterCard® from Capital One
The Secured Mastercard® from Capital One is an excellent starter card for someone just starting out with credit.
HIGHLIGHTS
· No Annual Fee, earn cash back, and build your credit with responsible use.
· Using your secured credit card helps build a credit history with the three major credit bureaus. Generally, prepaid and debit cards can't do that.
· Establish your credit line with your tax return by providing a refundable security deposit of at least $200 after being approved. Bank information must be provided when submitting your deposit.
· Automatic reviews starting at 8 months to see if we can transition you to an unsecured line of credit and return your deposit.
· Earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. Plus, earn unlimited 1% cash back on all other purchases - automatically.
· Discover is accepted nationwide by 99% of the places that take credit cards.
· Get 100% U.S. based customer service & get your free Credit Scorecard with your FICO® Credit Score
· INTRO OFFER: Unlimited Cashback Match - only from Discover. Discover will automatically match all the cash back you've earned at the end of your first year! There's no minimum spending or maximum rewards. Just a dollar-for-dollar match.
· Get an alert if we find your Social Security number on any of thousands of Dark Web sites.* Activate for free.
Pros
· This is a secured credit card, so you must put down a deposit. But you might be able to get a $200 line of credit with only a $49, $99 or $200 deposit. You can also be automatically considered for a higher credit limit with no additional deposit in as little as six months. The annual fee is $0.
Cons
· Although secured cards are easier to qualify for than regular unsecured cards, approval isn't guaranteed. You'll need to be able to show you can pay your bill, and, of course, you'll have to tie money up in a security deposit.
#6 Chase Freedom Unlimited®
The student version of one of our favorite cash-back credit cards, the Chase Freedom Student credit card has a lot to offer. The 14.99% variable APR is one of the lowest available for student credit cards, and you get a $50 credit when you sign up, a $20 bonus every year and a credit limit increase after five on-time payments.
· Standard APR: 14.99% variable
· Penalty APR: None
· Annual fee: $0
· Late payment fee: Up to $39
· Cash-back rewards: 1% on all purchases; 4% cash back on Lyft until 2022
· Foreign transaction fee: 3%
· Standout features: Free, unlimited access to credit score; Earn a credit limit increase after making 5 monthly payments on time
· Eligibility requirements: No co-signers, proof of income
Features and rewards
Chase offers cardholders free and unlimited access to their credit score, which can be an important tool for those building credit from scratch. The credit limit increase is another nice feature as credit use is a primary factor in a credit score. Most credit experts recommend using less than 30% of your total credit available, so the higher the limit, the easier it is to keep your credit use low.
Its 1% cash back on all purchases is consistent with the category average and the 4% back on Lyft rides is nice (though less practical for many in the coronavirus era). The $50 sign-on bonus can be triggered by making a single purchase in the first three months so you need not worry about hitting a high spending threshold. And the $20 annual reward can be redeemed for five years -- as long as your account remains in good standing.
Rates and fees
Every cardholder gets the 14.99% variable APR -- so you know what you're signed up for at the outset. It's best not to maintain a balance month to month, but if it happens once or twice, the interest will be lower than with other cards.
A few words of caution: This card's late payment fee can run as high as $39 for a first late payment; most other student cards have a lower penalty or no penalty for first-time offenders; and if you're planning on studying abroad, this card will subject you to a 3% foreign transaction fee.
#7 Deserve® EDU Mastercard for Students
The Deserve® EDU Mastercard for Students is an excellent option for students who can’t qualify for a credit card because they lack a U.S. credit history, a Social Security number or both.
Highlights
· Receive one year of Amazon Prime Student on Deserve after spending $500 in the first three billing cycles with your EDU card (Lifetime Value of $59).
· Earn 1% Cash Back on all purchases with your Deserve EDU Mastercard. Once approved, you'll automatically start earning cash back on all purchases.
· Feel secure with cell phone protection up to $600.
· No deposit required. No annual fees.
· No international transaction fees on purchases abroad so you can travel with confidence.
· No Social Security Number required for international students to apply.
· Refer A Friend Program: Refer anyone to Deserve using your personal referral code. Upon approval, card activation and use, you'll receive $30 and so will your referral. Referral bonuses are unlimited!
· Manage and track your spending, set automatic payments and securely freeze your card all through one easy to use app.
· See if you prequalify with no impact to your credit score in minutes.
· Deserve Mastercards are issued by Celtic Bank, Member FDIC.
· Enjoy Mastercard Platinum Benefits intended to make your life easier like Mastercard ID Theft Prevention™ and Master Rental®.
· Standard APR: 18.74% variable
· Penalty APR: None
· Late payment fee: Up to $25
· Annual fee: $0
· Cash-back rewards: 1% on all purchases
· Foreign transaction fee: 0%
· Standout feature: Low late payment fee
· Eligibility requirements: No credit score required; no Social Security number required for international students
#8
#9 Discover it® Student Cash Back 6
· Intro Offer: Unlimited Cashback Match - only from Discover. Discover will automatically match all the cash back you've earned at the end of your first year! So you could turn $50 cash back into $100. Or turn $100 into $200. There's no minimum spending or maximum rewards. Just a dollar-for-dollar match.
· Earn 5% cash back on everyday purchases at different places each quarter like Amazon.com, grocery stores, restaurants, gas stations and when you pay using PayPal, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases - automatically.
· Good Grades Rewards: $20 statement credit each school year your GPA is 3.0 or higher for up to the next 5 years.
· Earn rewards while building your credit history that can help you after graduation. And, get your free Credit Scorecard that includes your FICO® Credit Score and important details that help make up your score.
· No annual fee. No late fee on first late payment. No APR change for paying late.
· Refer-a-Friend: Once you become a Discover it® Student cardmember, you can earn a $50 statement credit each time you refer a friend and they're approved. Over half a million students got Discover Cards from their friends' recommendations.
· Freeze It® on/off switch for your account that prevents new purchases, cash advances & balance transfers in seconds.
· Get an alert if we find your Social Security number on any of thousands of Dark Web sites.* Activate for free.
· Discover is accepted nationwide by 99% of the places that take credit cards.
· 0% intro APR on purchases for 6 months, then the standard variable purchase APR of 12.99% - 21.99% applies.
Pros
· This card offers 5% cash back in rotating categories that you activate, on up to $1,500 in spending per quarter; all other spending earns 1% cash back. There's no annual fee, no late fee on your first late payment and a $20 annual statement credit for good grades (for up to five years). With this card, too, Discover says there is no FICO history requirement.
Cons
· Having to activate bonus categories every three months can be a hassle, especially when you're just getting started with credit, and some of the categories might be a poor fit for a student's spending. There's no foreign transaction fee, but Discover isn’t as widely accepted overseas — something to keep in mind if you're studying abroad.
Frequently Asked Questions
What Makes a Good Student Credit Card?
Student credit cards are a bit different than other first credit cards, because credit card issuers tend to give better offers to students than non-students in similar financial situations. For example, students can get an unsecured card with rewards, no annual fee, and low fees overall—such a product doesn’t really exist for non-students with no credit history. Some credit cards even offer special discounts geared toward students.
Why Should College Students Have a Credit Card?
Having a credit card in college allows you to start building credit early, and length of credit history is an important factor in credit scores (and one you can’t quickly improve.) It’s also easier to qualify for your first credit card while you’re still a student, because of the student-specific offers out there. Here's another overview of our picks for the best student credit cards:
BEST STUDENT CREDIT CARDS | ||
CREDIT CARD | CATEGORY | ANNUAL FEE |
Discover it Chrome for Students | Best Overall | $0 |
Discover it Chrome for Students | Best for Avoiding Fees | $0 |
Wells Fargo Cash Back College | Best With a Low APR | $0 |
Wells Fargo Cash Back College | Best for Earning Rewards | $0 |
Bank of America Travel Rewards for Students | Best for Studying Abroad | $0 |
Journey Student Rewards from Capital One | Best for Learning About Credit | $0 |
How to get a student credit card with no credit or bad credit
Just because you’re a college student doesn’t mean you’ll automatically get approved for a student card. Because of the Credit CARD Acts of 2009, a consumer under 21 must have their own source of income, even if the card requires no credit. Otherwise, applying for a card, no matter your credit, is pretty much the same – you need to make sure you have the right required credit, and you will be asked a series of questions on the application that will help the card issuer decide if you are a good credit risk. If you don’t qualify for a student card, a secured credit card may be a better choice for you.
Is a secured card a good choice for a student?
One thing to note: Student cards are typically unsecured, which means no security deposit is required, the credit limit is usually lower, and the average APR on student cards is 17.79%.
Should I get rid of my credit card?
Unless you have an annual fee, there is pretty much no reason to get rid of the credit card, and even then you want to make sure there are no benefits to counterbalance getting rid of the card. But you don’t have to live with things the way they are.
Can I get a credit limit increase?
The biggest change you might want to make is to get the credit limit increased. Here’s how: Once you start your new job out of college, contact the card issuer, and just ask. With your new salary, you should get a sizeable increase, which helps with your available credit if you have a balance.
Can I upgrade my card?
Here’s another tip: Check with your card issuer and see if you qualify for an upgrade that will allow you to keep your credit history. You might be able to graduate from a 1% back card to a 1.5% back card, for example. Just make sure it’s an upgrade and not a new account so that your history continues to grow. Also, there should be no hard inquiry if it’s an upgrade.
Should I add a credit card?
With all the cards available today, you can build points and cash back, earning for spending every day. You can apply for a card that rewards you for airline or hotel loyalty. Look at our best credit cards to see if there is one that suits you.
How Can You Get a Student Credit Card?
Getting a credit card as a student doesn’t require pre-established credit. However, if you’re younger than 21 years, you must show you have enough independent income to support making credit card payments. Otherwise, you need a co-signer who’s older than 21 and has income.
Can a Student Have Multiple Credit Cards?
A student can have multiple credit cards. However, it makes overcharging too easy. One card is enough to build credit. If getting more than one card, pace yourself by waiting a few months to see how you handle your current card(s).
What Should Students Know About Getting a First Credit Card?
There’s not one "best" credit card that’s a perfect match for all students. Each student has unique needs and uses credit cards in different ways. Some students use cards to help them budget their money. Others use credit cards to maximize rewards or build their credit history.
The most important thing for college students is to make sure they're ready for the responsibility. Credit cards are a great way to build credit while in college.
But students need to make sure they keep low balances and pay bills in full every month and on time. This will keep them out of debt and on their way to an excellent credit score.
When you apply for a student credit card, the issuing bank will look at your credit score and credit report to see if you are a good risk for that particular card.
The issuer will consider:
- Payment history
- Amounts owed
- Length of credit history
- New credit
- Credit mix
- Any sources of income
In most cases, the credit score lenders will look at is your FICO score. FICO stands for Fair Isaac Corp., which is a private company that assigns a numerical score to your credit rating.
Your FICO score represents the likelihood that you will pay your debts on time. Base scores range from 300 to 850, with a higher number indicating a better score. While there are other credit scores used by lenders, the FICO score is used most often.
Credit card issuers have slightly lower credit standards for student credit cards because they know you're just starting out in your credit life. If your application does get approved, you will receive a new credit card in the mail, usually within a week or two.
According to Student Monitor, the average credit limit for all college students is $1,315 as of spring 2016. But credit limits of $1,000 or less are not uncommon for those with very limited credit history.
When you use the card, the bank pays the merchant or vendor, and the bank then sends you a bill at the end of the monthly billing cycle. You are responsible for making at least the minimum payment by the due date. But you should always pay the bill in full each month so you won't be charged any interest.
Credit cards for people younger than 21
The Credit Card Accountability Responsibility and Disclosure Act of 2009 restricts the ability of banks to issue credit cards to individuals younger than 21. However, you can still qualify for a credit card when you’re younger than 21 if you or a co-signer can demonstrate the ability to repay credit card debts. Be prepared to provide written proof of income.
An alternative is becoming an authorized user. As an authorized user, you can get your own credit card issued on an existing account.
This can create a sticky situation, though, because the account owner is responsible for paying all charges. So, there needs to be a clear discussion about limits. Otherwise, personal and family relationships can suffer.
Most major credit card issuing banks will add an authorized user even if the user is younger than 18. But there's a minimum age, and it's usually between 13 and 16.
The account holder needs to confirm that the issuer reports authorized user activity to the bureaus. The primary account owner may have to pay a fee to add an authorized user.
What Card Features Are Essential to Understand?
Your credit card issuer will mail or email you a bill every month. You can also view your bill online at any time by creating an online account and logging into your card issuer’s website.
Here are the most important things you should understand about your bill:
- Total balance: This is the total amount you owe at the time the statement is issued.
- Activity summary: This summarizes the charges and credits to your account during the month. Here you’ll find the aggregate totals of all of the payments, credits, purchases, interest charges, fees, balance transfers and cash advances for the date range on the billing cycle.
- APR: Your annual percentage rate is the interest you pay to borrow money from the credit card issuer. Purchases, cash advances and balance transfers may each have a different APR.
- Minimum payment due: This is the lowest payment you can send to keep the account current and avoid a delinquency on your credit report. You need to pay this to avoid a late fee and other penalties.
- Payment due date: This is the end of the grace period, or the date by which the bank must receive your payment to stay current and avoid carrying a balance subject to interest charges. Grace periods range from 21 to 25 days, and it's the time between the end of your billing cycle and the date your payment is due.
- Credit line: This is your overall credit limit or the maximum you are authorized to charge to your card.
- Credit available: This is how much credit you have left before you hit your credit limit.
- Rewards: This section will tell you how much you have earned in rewards, whether as cash back on purchases or in the form of points or miles.
- Your free credit score: Most student credit card issuers provide either your current FICO score or an educational credit score from one of the major credit bureaus.
Tips for Using Your Credit Card Responsibly
- Charge only what you can afford to repay by the time the bill comes due.
- Pay your bill on time.
- Use as little of your available credit as possible.
- Avoid cash advances. They carry hefty fees and start accruing interest immediately.
Can I Pay Tuition & School Expenses With a Credit Card?
While your school might allow you to pay tuition with a credit card, it often comes with a service charge—not to mention the interest costs you’ll accrue if you don’t immediately pay off your credit card balance.
However, for textbooks and other regular purchases, you can pay these costs with a credit card, earn rewards (if your card offers them), and pay off the balance. You might even qualify for a card with a 0% APR period on purchases, which may give you the flexibility to pay off your start-of-term expenses over time.
Since both tuition and school supplies can get expensive, be careful that you don’t max out your limit or come close to hitting it. Using more than 30% of your available credit limit will hurt your credit score. (The less of your available credit you use, the better.)
What Happens To Your Student Credit Card After Graduation?
Your credit card company will let you keep your card after you’re no longer a student, and it might even allow you to “upgrade” to the non-student version of your card. Check with your card company to get the details.
Whatever you do, don’t close the card if it doesn’t have an annual fee. Keeping your oldest credit card open for a long time will help you establish a good credit history.
What Are the Costs of Credit Cards?
Of course, using credit cards can be costly. If you're a student who's considering getting your first card, you need to understand the following fees and terms so you choose the card that's best for your needs.
Understanding your APR
The annual percentage rate is the interest that applies to your balance after your grace period expires. Once you start carrying a balance, you start paying compound interest on your purchases. Compound interest can create big balances in a hurry.
Credit card APRs are typically variable, which means they will fluctuate with the federal prime rate. When federal interest rates rise, your credit card interest rate rises, too.
How credit card companies calculate your interest
You don’t have to pay any interest charges on purchases as long as you pay off your balance in full and by your due date every month. The amount paid off before then isn’t counted in the total daily balance.
If you only pay part of the balance by the end of the grace period, the remaining balance you carry over will accrue interest that will appear on your next billing statement.
Alternatives to getting a student credit card include:
1. Becoming an authorized user. An authorized user is essentially piggybacking on someone else's credit card account (usually a parent's). You get a card with your name on it, but the primary cardholder is legally responsible for paying the bill. Authorized-user status can help you build credit if the issuer reports activity on the account in your name as well as in the name of the primary cardholder.
2. . Applying for a secured card. Secured cards are designed for people with bad credit or no credit. You put down a cash security deposit, and you get a card with a credit limit that's usually equal to your deposit. The card works like any other credit card — you charge purchases and then pay them off — but if you fail to pay your bill, the issuer can take your deposit to satisfy the debt. When you close or upgrade the account, you can get your deposit back. See NerdWallet's best secured cards.
3. Using a prepaid debit card. If your primary concern is the convenience of paying with a card rather than cash or checks, a prepaid debit card can be a suitable alternative. With prepaid debit, you "load" money onto the card, and your purchases are paid for out of that money. However, because a prepaid debit card does not involve borrowing money, it won't build your credit like a credit card would. See NerdWallet's best prepaid debit cards.
4. Finding a co-signer. A co-signer on a credit card is someone who agrees to pay the debt on the card if the primary cardholder does not. Most major credit card issuers no longer allow co-signers, but smaller banks and credit unions often do. Having a co-signer can make it possible to qualify for a card you couldn't get on your own.
Finally we hope this list of 10 best credits cards for college student cover your answer.
Post a Comment
Let us know how you are feeling about this article by commenting.