As a college student, the last thing most worry about is credit. However, getting a credit card and establishing good credit while in school gives you a head start to make things like buying a car easier post-graduation. Other benefits of having and maintaining good credit include better insurance rates, more negotiating power for loans, and easier approval for home rentals.
Being a student will not guarantee an approval due to contributing factors like income, past credit, or no credit history. In these situations, some opt to get a secured credit card. These cards are commonly used to help people build credit who have had trouble getting approved for regular credit cards in the past.
Here are some examples of credit cards available to college students:
I. Discover it® for Students
Benefits of this card include, enabling students to earn 5% cash back now at Amazon.com, department stores, and Sam’s Club up to $1,500 in purchases, no annual or late fees on first late payment, and Discover will match all the cash back you’ve earned at the end of the first year for new card members.
2. Journey® Student Rewards from Capital One®
Similar to the Discover card, Capital One offers 1% cash back on all purchases, no expiration date on rewards, and the ability to choose your own billing date. There are also no annual fees, and students have the opportunity to raise their credit limit after 5 on-time monthly payments.
3. Citi ThankYou® Preferred Card for College Students
Benefits for Citi’s student credit card offers 0% interest for 7 months on purchases, no annual fee, and ThankYou points that are acquired depending on how much is spent. These points do not expire and can be redeemed for merchandise, travel, and cash.
These are just a few examples, but it’s important to do research to compare all credit card options to see what works best for you. For students under 21, federal laws make it difficult to obtain a credit card unless the applicant has the independent ability to repay their debt, or has a co-signer over the age of 21 that agrees to accept joint liability for the account.
The most important factor when managing a credit card is to spend responsibly, and pay your bill on time! Apart from the benefits that come with having good credit, poor credit can delay purchasing a home, car, or obtaining a loan. Putting yourself in debt can also take years to fix.
If you are struggling with credit card debt, non-profit debt management organizations like the National Foundation for Credit Counseling (NFCC), can connect you with financial experts that will help manage your debt and personal finances.
Credit cards can be intimidating, but with the right information and plan of action, you can put yourself on a path to great financial health.