What are the benefits of student credit cards?

Answered on October 10, 2010
Updated on October 10, 2010
The content is accurate at the time of publication and is subject to change.
James Williams James Williams
Student credit cards are an interesting strategy of many credit card issuers. Students belong to the part of the population that has a steady expenditure and usually some bills to pay. Invariably students get money from their parents or guardians which means, most of them have a decent income source. These are the reasons why a lot of credit card companies offer students in the campuses, credit cards with good incentives. From the students' perspective, there are quite a few benefits of taking the students' credit card offers. To start with, those with no credit history find it very hard to get their credit card applications approved. Students are an exception to this. Moreover, without a credit history, the interest rates on the credit card or the loans approved for the customers are sky high. The first benefit of the student credit card is that it allows the students an opportunity to start building a credit while they are still in college. Most of them have a steady income in the form of pocket money and lot of expenses too such as phone bills, books, food etc. All this can be made to count by using a credit card and getting a history so that by the time they are out of college, they have a decent enough credit rating to go for credit card with good rewards and lower interest rates. As soon as one gets a job, getting a vehicle and having insurance coverage are some of the expenses that are almost mandatory. But with a credit history built through students' credit cards, you can get vehicle loans for lower interest rate insurance for lower premiums that those without a credit history would be able to get. The greater the expenses and the more consistency one maintains in paying the bills without letting the outstanding dues stay the better would be the credit rating. If students can sensibly manage their pocket money through the credit cards and use the monthly expense report to keep a check on their expenses, they can build a good credit history which will help them with better offers in the future. Student credit cards usually need a guarantor, and so the credit history on the student credit card often reflects for the guarantor as well. It means that it can work both ways and while a good credit history will reflect well for both the guarantor and the student, a bad credit will also poorly reflect on both of them.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.

User Comments about This Question

BROWSE MORE QUESTIONS ABOUT Student Credit Cards:

No, you won't need a co-signer to apply for a student credit card or Amex Everyday. In fact, there are not many issuers that would allow co-signers. That is actually great as cosigning is a complicated thing. Having your own credit card from the beginning is a great way to learn finances, responsibility, and to start building credit. You may qualify for a student credit card as long as you are at least 18 years old, have SSN, U.S. citizen/resident, and have verifiable income. To qualify for the Amex Every Day card, you should have at least good credit history. If you already have some...
The Amex EveryDay card is for applicants with good or excellent credit history. If your credit is lower, we would recommend considering a different credit card. Since you are a student, you can apply for a student credit cards. These cards are rather easy to qualify for but there still are some approval requirements. The requirements are simple: you should be a student over the age of 18, be a U.S. citizen or resident, have SSN (Social Security Number), have a verifiable income (your part-time job and money form parents will do), and you should not have bad credit already. You may qualify...
Starting credit history from the very beginning is always better than improving it and credit card issuers are not too captious.Look into credit cards for those with limited/no credit history: these cards are created for newbies. The cards have quite high APRs and fees. However it is possible to find a card with 0 intro APRs or without annual fee. Also some cards offer bonus programs: you can earn points or cash back on purchases you make.If your son wants a bonus credit card, Wells Fargo Cash Back College Card is not the best option as it has no bonus.

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