Student Credit Cards
For many parents, the idea of student credit cards can be a scary thought. Most of us at that age, just weren’t responsible enough to handle a credit card. In fact, many adults aren’t responsible enough. But the fact is, student credit cards exist and the credit card companies spend a lot of money marketing their credit cards to high school and college students.
Some student credit cards require no credit history to get approved and others do look at your credit. Sometimes these student credit cards are combined with prepaid credit cards which actually require a deposit up front, much like a checking or savings card.
The reality is that if you ever want to get good rates on a car loan, home loan or any type of credit line, then it is extremely important to build and maintain a good credit history.
Student credit cards are specifically designed to help students who mostly will have very limited credit histories. If you are a student considering applying for a credit card, it is very important to be responsible when using your card. So many students who apply for a new student credit card and are approved, end up destroying their credit because of irresponsible credit habits.
When your credit score is impacted in a negative way, it can take years to get it back to an acceptable level in order to qualify for low interest loans. The bottom line is, if you don’t have the money and can’t afford it, then don’t buy it. We all have the natural human desire to have nice things, but if you spend money you don’t have, and charge everything to your credit card, it will eventually come back to haunt you.
One recommendation to students who have student credit cards is to make sure you pay your balance in full, every month. Credit card companies profit from compounding interest on unpaid credit card balances. If students pay only the minimum balance every month, it’s highly likely that they will become deeply in debt, just like millions of other Americans. This is a hole that is very hard to dig yourself out of.
Some student credit cards are Discover® Student Card, Citi ForwardSM Card for College Students, Citi® mtvUTM Platinum Select® Visa® Card for College Students. Of course there are more and be sure to read the terms and conditions so you understand what you’re getting into.
