A College Student Credit Card – Get One

Why Your Student Needs a College Student Credit Card

Get a college student credit cardCollege is usually a young adult’s first foray into the adult world of responsibility.  Without a strong money management strategy, a college student credit card can cause college students to quickly accumulate debt if they are not careful.

There are several ways, including a college student credit card that can be a great ways for students to learn about handling debt effectively.

If you do not feel your student is ready for a credit card of their own, you can add them on as a user to one of your credit cards.  Your student will then have the responsibility of using a credit card but with additional limitations and liability.  It is important for you to understand the risk of taking a chance on someone else running up debt on your credit.  Make sure that you have the means to pay off any debt if your student cannot.

Another option to teach your college student about money management is to have a debit card for day to day expenses, while a college student credit card can be used only for emergency purchases.  With a debit card, your student will have to keep on budget or risk running out of money before the next pay period.

A secured credit card is a good option for many students.  A secured card is backed by money that is paid up front and the credit card charges are withdrawn from that lump sum.  This is a good way to establish credit without risking harm to their credit score.

When teaching students about the responsibility of having a college student credit card, it is important to set strict usage guidelines so they do not develop bad spending habits early on.

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If you feel your student has a good grasp on budgeting and savings, a credit card can offer many perks that debit or secured cards do not offer.  Many credit cards give cash back on purchases, free air miles, and free hotel points.  The caveat is that your college student must be able to pay bills on time and pay the credit card in full each month to avoid extra fees and penalties.

Here are some smart tips when selecting a college student credit card:

Annual Fees.  Some cards have a fee that is charged every year.  Make sure that you choose a no-fee or low fee card.  Also look at cash advance fees, late fees and application fees.

Annual Percentage Rate (APR).  Select a card with an APR of no higher than 16%.  Look for a card that offers the lowest APR.

Bonuses.  Look for credit cards that offer cash back and other reward type programs.  Watch out for earning limits and requirements.

No matter what type of college student credit card you decide to be the best option for your student, proper budgeting will be required.  Students have tuition expenses, books and supplies, food, and entertainment costs. What students learn during the first year can determine how they manage and save money through to retirement.

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