I can still remember when I got my first credit card. It was the 1986-1987 school year and I was a freshman at the University of California, Irvine.
What I recall most is walking into my dorm room for the first time, and finding applications for credit cards lying right there on my dorm bed. The mattress was completely bare, except for those credit card offers emblazoned with Visa and MasterCard logos.
To me, they were like formal invitations to adulthood. And sure enough, I later felt so grown up – “I’m officially an adult!” I thought – when I got approved for one, and then another and yet another of those nice, shiny pieces of plastic.
Too bad nobody taught me how to use credit wisely, how to budget, or even how to know when – and when not – to use those darned cards. (One good rule: emergency use of credit cards is OK; everyday use for pizza or clothes shopping, not so much).
These days, college kids have it somewhat better. Thanks to Credit Card Reform Act of 2009, credit card firms face restrictions in marketing credit cards to students.
If you’re 21 or under, a must parent co-sign your credit card application; otherwise, you have to show enough income to be able to repay any credit card debt you incur.
It’s OK to Have Credit Cards While in College
Despite the push to regulate credit cards for young adults, you shouldn’t buy into the concept that credit cards are evil or always bad for college students.
On the contrary, when you’re in the college phase of your life, and are preparing for the real world, a student credit card could be a key tool to help you start learning important financial concepts: things like budgeting, managing cash flow, and delayed gratification.
If you can get off to a good start with credit as a college student, hopefully you’ll learn positive fiscal habits that will last a lifetime.
So if you (or your child) are looking for a good student credit card, here are the 3 best credit cards for students that I’d recommend:
The BankAmericard for Students touts a rare find among student cards – a 0% Annual Percentage Rate for both purchases and balance transfers made during the first 15 months (balance transfers are subject to a 3% transfer fee).
So this is an especially good option if you need extra time to pay off expenses like tuition, books or college fees. The regular APR for this card is variable and ranges from 10.99% to 20.99%.
The Capital One Journey Student Rewards Card features a 19.8% variable rate, no annual fee, a 1.25% cash back bonus, plus special credit-building features for those with fair or limited credit.
Those features include access to your monthly credit score, an online credit-monitoring tool, and text and email alerts to help make sure you don’t overspend or miss a payment.
Finally, the Discover It Student Card offers a 0% Annual Percentage Rate on purchases for the first six months and 1% cash back on all purchases. The card’s regular APR is variable and ranges from 12.99% to 18.99%.
What’s more, this card has no over-the-limit fee, and Discover gives cardholders 5% cash back on purchases for dining out, movies, gas, and more (the categories rotate every three months).
If you’re searching for a good student credit card, you really can’t go wrong with any of these three options.