A student credit card can help ease the financial burden of paying for college by giving you easy access to credit if you’re over 18 years old. However, not all student credit cards are created equal—and it’s important to know what to look out for when choosing a card that best suits your needs. Here’s everything you need to know about student credit cards, including how to find the right one, the application process, and how to use it once you’ve got your hands on one!
A student credit card can help you build your credit history, but not all cards are created equal. A student credit card typically has lower credit limits and higher interest rates than general-purpose credit cards, which makes them the perfect option to use only while you’re still in school and don’t have other loans or lines of credit. Here’s what you need to know about student credit cards, as well as tips on how to apply for one and some recommendations of great cards to get your hands on as soon as possible!
What exactly is a student credit card? If you’re an undergraduate or graduate student looking to build your credit while in school, it might be tempting to apply for one of these cards—but before you do, take some time to learn about the benefits and pitfalls of these cards so you can make an informed decision. Let’s take a look at what a student credit card is, how to apply for one, and what kinds of rewards are available to make sure you get the most out of your new plastic.
What is a Student Credit Card?
There are a few different types of credit cards available specifically for students, including those with rewards programs, lower interest rates, or no annual fees. However, if you’re just starting out in college and don’t have a solid financial track record (or history at all), getting approved can be tough. Even some cash-back credit cards with no annual fee are harder to get approved for when you’re under 21 years old. So how do you apply? And what does it take to get one?
There are many different types of credit cards available in today’s market. Each type of card is designed with a different audience in mind, but one that’s becoming increasingly popular with college students is a student credit card. This type of card was designed specifically for individuals who have limited or no credit history, making it easier to get approved than other cards on average. However, getting a student credit card can still be tricky at times because if you’re young and don’t have any financial experience or history under your belt yet, it can be tough to get approved without some added security in place. Fortunately, there are some things you can do as a student or recent graduate that can help boost your chances of getting approved.
The difference between a student credit card and a regular credit card
A student credit card, sometimes called a university card, is a form of credit offered to students who are attending college. These cards come with a lower limit and can be used just like regular credit cards, except they are linked directly to your bank account (so spending will impact how much you have in your checking or savings account) and don’t require income verification. They may also come with perks like cash back rewards or gift card promotions, depending on what kind of card you get. Student credit cards offer an opportunity for students who haven’t yet established a solid financial history and/or those who are too young to get a regular credit card.
A credit card is a way of borrowing money. Most credit cards allow you to borrow a certain amount of money, typically in line with your limit, which you can then spend using your card. You have a specified time period (generally between 30-90 days) in which to pay back what you’ve spent or carry it over into a new month. If you do not do so, interest will be charged on what you owe each month until it’s paid off, at an agreed-upon rate. This rate is usually expressed as an annual percentage rate (APR).
Which student credit cards are best?
If you’re a student with poor or nonexistent credit, your options are limited. That said, there are plenty of good student credit cards on offer for students. Read our picks for the best student credit cards here. We break down what to look out for when applying and recommend some of our favorites. The first thing to do is decide whether you want an unsecured card or a secured card. An unsecured card is just like any other credit card; it’s issued without requiring collateral (like an equal amount deposited in a savings account). Secured cards require that you deposit money into an account as collateral against unpaid balances, so they’re not ideal if you have no money to deposit.
Who should get one?
If you’re a student, you should get one. If you want or need a credit card, but haven’t started building your credit yet, there are options designed specifically for students. In fact, just about every major credit card company offers at least one type of student credit card (but we will take a look at some of our favorites below). Student cards typically have low spending limits, making them ideal for use on necessary purchases. Using one responsibly can also help build up your credit history and scores before you graduate. Depending on what kind of job or career path you are considering in college or beyond, these might even be worth holding onto past graduation day! What does that mean?
The right way to use your student credit card
When it comes to credit cards, most students start thinking about them way too early. Many high schoolers get their first credit card before they even graduate, and it’s tempting to use them right away, especially if you have parents who are willing to take on some of your expenses. As someone who’s paid a few college bills over time, let me just say that student credit cards can be great for emergencies. They aren’t so great for buying books or beer! First off, avoid that temptation at all costs! The interest rate on student credit cards is usually high enough to turn a couple of grand worth of beer money into an absolute nightmare later on.
Avoid these mistakes
When you’re just starting out in your life as a student, it’s important to remember that credit card companies aren’t interested in helping you build your credit history. What they are interested in is their bottom line. And one of their favorite ways of increasing revenue is getting students to sign up for credit cards with rewards programs or cash-back deals, then paying high-interest rates on balances that could be avoided if a student played his or her cards right from day one. So before you apply for a credit card, make sure you do your research into what makes a good rewards program and how best to use it once you have it!
Alternatives to a student credit card
Having a student credit card is a great way to establish a good credit history. But just like any other type of debt, it’s important not to overdo it. Just because you can get a credit card doesn’t mean you should use your credit card every time you go out with friends or purchase something online. This is a surefire way to get into trouble with too much spending and credit-card debt, so be careful! If you can avoid using your student credit card while in school, that’s usually best. Get good grades, save some money and work hard now: Your financial future will thank you later!
Don’t worry too much about debt
Student credit cards are a great way to learn how debt works, but only if you don’t carry a balance from month to month. If you’re tempted by a low APR, ask yourself: Will I pay off my card in full each month? Most likely not. In that case, avoid interest as much as possible by applying for a card with no annual fee. This gives you extra room in your budget should emergencies arise or you want to splurge on something fun without worrying about interest rates. You can always upgrade later once you know what kind of budgeter (and spender) you are.
In Conclusion
And that’s a wrap! You now know everything you need to in order to successfully apply for a student credit card. What are you waiting for? Apply now!
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And now, you’re all set! Good luck with everything, it should be smooth sailing from here on out. Thank you again for taking time out of your day to read my guide. I really appreciate it. Don’t forget to check back every once in a while so you can see more cool stuff like this!
