If you are a student in college, you are likely bombarded with a plethora of expenses. From tuition to books to food and
clothing, the costs of attending college have never been greater.
Credit cards for college students are specifically designed
for the needs of students, and are a convenient way for students to build their credit while learning about financial
responsibility.
Secured and Unsecured Student Credit Cards
When selecting a student credit card or credit cards for college students,
you will need to determine if you want a secured or unsecured card. An unsecured credit card for students is a card that is issued
based on the bank or credit card issuer’s belief
that you will repay them for the credit that they extend to you. Most students can qualify for a student credit card of some type.
There are also
secured credit cards. These types of credit cards are super easy to get and require that you deposit an amount
of money that is usually equal to the amount of credit that you want to have. For example, if you want a $500 credit line,
then you would make a deposit of $500 to the issuing bank. After a period of time has passed, usually a year, your secured
credit card will usually convert to a standard credit card, and the issuer will return your deposit to you. Whether a secured
or unsecured credit card for students is best for you depends on your needs and your ability to make a deposit.
Building Credit with Credit Cards for College Students
One of the biggest benefits of holding credit cards for college students is that they help to build positive credit history.
Your credit file is very important to your financial future, and having a credit card during college is a good way to get
started building your credit while getting needed help with your college expenses.
Manage Your Money
With a student credit card and with a secured card in particular, you can learn the basic skills of budgeting your money.
By using the card for necessities and paying it off at the end of each month, you can learn valuable lessons on how to manage
your money. Some parents place only the amount of money that they want their college age child to have onto the secured card
and then expect them to manage the money until the next time that a deposit is made.
The Best Credit Cards for Students
The
best credit cards for college students are those that charge very little interest (less than ten percent is ideal,
although there are cards out there that charge zero percent for a particular time period). Be wary of credit card offers
and their “fine print”. Oftentimes, a credit card for college students will look like it is a good deal until you read the
terms and conditions that come along with it. Many times, students will find that their credit card is issued at a low rate
of interest that quickly inflates to an outrageous amount of interest after just a few months. The lower the interest, the
easier it will be to pay the credit card off.
The article was updated on 03/14/2012.
Some information may have changed since that date. We strongly suggest that you carefully read the
Terms and Conditions statement that accompanies credit card applications.