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Should College Students Have a Credit Card?

Last Updated: August 10, 2021
3 min read

A credit card can be much more than just a convenient way to pay for today’s college expenses. It can provide peace of mind in emergencies, allow you to accumulate rewards and cash back, and be a useful tool to help college students establish life-long good financial habits.

Beyond the perks of credit card rewards and counting points, students may want the peace of mind that can come from using a credit card as well as the convenience of easy to use mobile features.

Wherever your educational journey leads you, consider these five reasons to have a credit card:

Build a credit history

From the time you begin using a new credit card, you are building a relationship with your credit card company. Responsible use, such as paying your bills on time and in full and keeping your balance low, may be reported to the credit bureaus helping you to build a credit history. Then, when you’re ready to apply for a higher credit limit or a card with different benefits, you’ll already have a track record as a good credit card customer.

Learn to budget

Having a credit card as a student can teach you powerful lessons about paying your bills on time and creating a budget. Using a credit card will require you to think ahead to your payment due date, and budget to make sure you have the money available to make at least the minimum payment every month. Some credit cards allow you to track what you spend and organize transactions by type on their websites and mobile apps, so you can see where your money is going. Learning the skills of budgeting and scheduling bill payments may help you later in life when you’re managing bigger dreams and likely, more money.

Enjoy rewards and cash back

Certain credit cards allow you to earn rewards, points or cash back for a variety of things. For example, the Discover it® Student Chrome credit card allows you to earn 2 percent cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter, automatically, plus unlimited 1 percent cash back on all other purchases.1 Another option includes the Discover it® Student Cash Back credit card, which allows you to earn 5 percent cash back on everyday purchases at different places each quarter like Amazon.com2, grocery stores, restaurants, gas stations and when you pay using PayPal3, up to the quarterly maximum when you activate. You also earn 1 percent cash back on all other purchases. And don’t forget, neither card has an annual fee.

You can handle emergencies

Cars need repairs. Computers need fixing. Smartphones get dropped. Life happens. It’s reassuring to know that in the event of a real emergency, a credit card can help cover emergency expenses. Students can pay for unexpected medical or dental expenses, or even rent a car with a credit card. This benefit might help you — and your parents — feel a little more secure. Of course, you’re still responsible for the credit card bill that comes from these expenses, so make sure you reserve this type of credit card use for true emergencies.

Renting or buying a house or apartment

Many rental applications require a credit check so that landlords can review the applicant’s credit history.  Here again, student credit card use with a strong track record of repayment can help build a credit history and identify you as a responsible young adult and potential good tenant, helping to strengthen your rental application. When you’re ready to buy a home, a strong credit history will also be key to getting a mortgage.

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