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With so many student credit cards out there, a lot of younger students don't know where to turn when it comes to getting a card. I thought I would make it easy for those that want a card for their particular spending habits. Most students think that when you apply for your first card that you're not going to get rewards simply because you're new to the game. This couldn't be further from the truth. I'm going to rate each reward category and show you what I think of how it can help you with your spending.
Cash back rewards: A
I love these types of cards. You're going to get the most out of your money and when you get the rewards in the long run, you're going to be able to use those rewards for basically just about anything. Now, some cards will be called “cash back” cards but you won't necessarily get cash back but points instead. You will be able to use these points for gift cards, etc, which are just as good as cash. If I were to pick out a card, I would look into this type.
Gas rewards: B
Gas rewards are great but as a college student, you may find that you're not going to benefit from this as much. The reason I gave it a B Is because as of now, the gas prices aren't that high but when they are, this would be a great card. For now, let's play it safe and consider this a B average card because it's only limited to auto rewards and saving on gasoline.
Travel rewards: C
Most students don't travel via the air much and this is why I would steer clear of a card that just gives you rewards for flying. Most students don't fly or rent cars, your rewards are going to go to waste because of this. Instead, I would wait on a card like this in the future when you start to travel more either via business or with your family. While these cards can be great, they aren't the best for college students.
No rewards: F
Obviously this is going to get a failing grade because there are so many cards out there that offer rewards. Don't just settle for a card that has limited or no rewards. Instead, do your research and find a card that's going to give you something back. If you can't find anything that will approve you and you're limited to this type of card, then by all means, apply for it. Just make sure that you get a card with no fees.
Hopefully by now, you'll have a clear understanding on how student credit card rewards work. You now know what kind of rewards are out there and how you can take advantage. These are my grades and you may think differently. If you do fly a lot as a student, you'd probably grade it higher but many don't, that's why. Do your research, find the right card and you'll be just fine.
Today, credit card is not a symbol of luxury anymore. Credit card is a great convenience, meaning that you don't have to worry about cash when making a purchase. Even though that the requirements of getting credit card are so strict for students, but many credit cards issuer still giving a chance to let them have their own credit card. Student credit card can be used the same way as a traditional credit card, although it do come with certain restrictions and limitations that other credit cards don't normally have.
Most banks and credit cards issuer requires co-signer for student credit card application to avoid risk in the future. This person will sign on the loan with the student, and will be the person who will pay the bill if the students are unable to do so. Usually parents will be as co-signer to back up when applying for student credit card in case the students cannot afford to do the pay out.
Some company will charge higher rate or APR for student credit card because they want to lower the risk for their company. The card spending limit may be different from one to another that can be between 250 to 800 dollars.
Students, who are planning to make a large purchase, can greatly benefit from using student credit card. To make large purchases, you'll need good credit - which is where a student credit card can really help out. You can use these credit cards to build credit, and establish good credit rating background. Your good credit card rating will be an added advantage when you apply for a loan in the near future.
Student credit card indirectly will teach students about the sense of responsibility. The card works just like any other credit card, although the spending limit is much lower. But once the student has mastered usage of the card, he or she can manage money much better later on in life. This card is great for students to have, and can teach them money skills that will last a lifetime.
Just like traditional credit card, students should also know that student credit card can be dangerous. Even though that it is great, there is possibility such as overspending. If students spend more money than they having coming in, they will be unable to pay their credit card bill, which will then affect their credit. Need to remember that co-signer credit may affect if the credit card issuer goes after them to pay out the bill. Plan the budget every month when you finally decide to use student credit card.
All in all, student credit card is convenient to have. For students, this credit card is more like a freedom and it is a way to teach about financial responsibility. It will be useful especially during emergencies, which the biggest reason to invest in them. If your son or daughter is still studying, you can consider looking into student credit card. It can help your child to establish credit - which will take them farther wherever they go in life.