Finance

Jun 12 2017

Best Student Credit Cards 2015: Compare Top Offers for College Students #westmark #credit #union


#best credit card for college students
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Student Credit Cards

A credit card is a rite of passage for college students, but did you know some cards are specifically designed with college students in mind? Choose the right one and you’ll get rewarded for the kind of spending others like you tend to make. Use our syllabus below to narrow down your choices.

How to Choose a Student Credit Card

How to Choose

Credit cards are a fantastic tool to have in your wallet as a college student. They are an easy payment method, and, when used properly, help you build a positive credit history, a key area that lenders will be looking for when you need to borrow money later in life, such as for a car or mortgage. Credit cards are also safe and secure, helping to minimize the impact of fraud on your finances. But with so many offers to choose from, the prospect of picking one can seem daunting.

Thankfully, some credit cards are designed specifically with students in mind. And there are ways you can ease the decision-making process. Follow these five steps when choosing the best card for your wallet:

  1. Research, research, research. Put your experience doing research for term papers to work. Those skills will come in handy when it’s time to choose a credit card. Each credit card has different features and costs, so you will need to take your time reviewing the options. If you simply settle with the first card you come across, you may be selling your wallet short.
  • Ask yourself: “Will this be a long-term or short-term relationship?” When reviewing card features, think about both your current needs and your future goals. You won’t be a college student forever. Consider if the features will meet your needs when you graduate and whether that matters to you.

    If you do decide that you want a “short-term” card, keep in mind the impact this may have on your credit score. You get “points” for the length of your credit history – the longer the history, the better the score.

  • Make the decision: Sponsorship or Free Agent. If you are under 21, due to the CARD Act of 2009. you have to meet additional credit card lending qualifications. This change can make it a little tricky for students to qualify for credit cards, especially when they have limited income. So, many young adults tend to take one of two routes: obtain a cosigner or show proof of income.

    Having a cosigner means that your parent or another adult has agreed to take on the responsibility of your debt should you default on your payments. This is a big request to ask of your parent—if you miss your payments, it will not only affect your credit score but might affect theirs as well.

    If you have income from a job, you may be able to qualify on your own.

  • Learn the Costs. Ever hear the saying, “There’s no such thing as a free lunch”? Well, that statement holds true when it comes to credit cards. But don’t be discouraged—with a little research, you’ll likely find a card with minimal costs. Here are the key costs you should pay attention to:

    • Interest Rate: The rate that is charged on your credit card balance, expressed as the APR (annual percentage rate). Usually, if you pay your balance in full within the designated grace period, you won’t be charged interest. Funds transferred from another credit card (balance transfers) typically have a separate rate.
  • Annual Fee: Some cards charge you a fee once a year simply for the privilege of having the card. For college students, it’s usually best to look for a credit card with no annual fee.

  • Late Fee: The fee charged when you don’t make your payment on time. Hopefully, you will never face this fee. However, you should know the cost of a late payment in case it happens. Moreover, look into whether a late payment will trigger a higher interest rate.

  • Over-the-Limit Fee: This fee is charged to card holders when they make a charge that puts them beyond the stated credit limit.
  • Find the Perks. Many credit cards come with rewards or cash back options. When evaluating these perks, do a cost-benefit analysis. Often, rewards credit cards have higher interest rates, so you’ll need to decide if those potential costs are worth the value of the promised rewards. If you think you’ll carry a balance, you’d probably be better off finding a low-interest credit card without a rewards program. Don’t forget to look for other perks like extended warranties on eligible products and car rental insurance; many credit cards offer these and other complimentary services.

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