A student credit card is not just any card; it's your first step toward managing your own finances. Because it’s for students just stepping into the realm of credit, these cards are made to be both a learning tool and a financial resource. With a student credit card, you begin the journey to financial independence by making purchases, paying bills, and understanding how credit works in real life.
Student credit cards come with several key benefits, all aimed at teaching you to be a responsible spender and saver. These benefits might include access to financial education resources, plus alerts and reminders to help you stay on top of payments. Reward yourself with cash back or other perks, turning everyday spending into savings or rewards.
While these cards typically offer initial credit limits to match a student's budget and spending habits, your active engagement and responsible use are crucial. It's how you start building a solid credit history.
What Are the Benefits of a Student Credit Card?
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Key Takeaways
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Student credit cards can help students build a credit history.
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Some student credit cards offer cash back, or other rewards.
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Student cards may offer perks, like no annual fee, or no foreign transaction fees.
What is a student credit card?
A student credit card is a type of credit card for college students who are just starting to build their credit. These cards often come with no annual fee and provide benefits and perks like rewards programs, which can make them an ideal choice for stepping into financial independence.
Can a college student get a credit card?
Yes, college students can get credit cards. If you're at least 18 years old and can show that you have some form of proof of income or assets, you might be eligible. Credit card issuers will also check if you're enrolled in college, either full or part-time, to determine if you qualify for a student credit card. Meeting these criteria helps issuers ensure that you can manage a credit card responsibly.
Student credit card benefits
Student cards could help you build a credit history
When you start to build your credit history, it might seem daunting. But it’s a smart move that pays off. A student credit card can be your ally in this journey. It’s just for students who might be managing finances on their own for the first time.
Here’s why it’s a good idea:
- Easy to start: Even with little to no credit history, you may be eligible for a student credit card. It’s a first step towards showing lenders that you’re good at managing money.
- Learn as you go: Using a student credit card for daily expenses and paying off your balance regularly teaches you financial responsibility. Plus, it’s a practical way to learn about interest rates, minimum payments, and budgeting.
- Build your score: For every payment you make on time, you’re building a positive credit history. Good credit is key for future financial milestones, like getting a loan with lower interest rates or renting your dream apartment.
- Simple habits; big impact: Small, consistent actions with your student card can lead to a solid credit score. Just paying the minimum each month, ideally more, avoids late fees and keeps your credit in good shape.
Remember, a student credit card isn't just for purchases; it's a tool for building a strong financial foundation. With a student credit card, college students may begin to understand the concept of a credit limit, how much available credit they have, and learn how to avoid going over the credit limit.
Start using one wisely now, and you'll set yourself up for a smoother financial path ahead.
Did you know?
Using a student credit card allows you the chance to create responsible bill-paying habits. With the Discover It® Student Cash Back Card, you can build your credit with responsible use.1
Student credit cards may offer rewards
Credit card issuers offer a variety of card options and rewards. For example:
- With the Discover it® Student Cash Back card you can earn 5% cash back on everyday purchases at different places you shop each quarter like grocery stores, restaurants, gas stations, and more, up to the quarterly maximum when you activate.
- With the Discover it® Student Chrome card you can earn 2% Cashback Bonus® at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter, automatically. Plus earn unlimited 1% cash back on all other purchases.2
How to choose a student credit card
Choose one card that works for your situation and avoid signing up for additional lines of credit at every retailer you shop with. Signing up for multiple credit cards in a short period may hurt your credit score regardless of how responsibly you use them. Consider these features before choosing a card:
Consider a card with a low introductory interest rate. Making ends meet and still getting good grades can be a big challenge for students who work part- or full-time while earning a degree. It’s not advisable to sign up for a credit card with the intention of carrying a balance. If an unexpected expense forces you to carry a balance, a card with a low introductory interest rate can help keep you out of financial trouble while you’re working toward your goals.
Consider a card with no foreign transaction fees. If you’re planning on studying, traveling, or working abroad, some fees could kick in when you’re overseas. Foreign transaction fees are just what they sound like—fees levied when making transactions or purchases abroad. For example, ATMs might charge extra fees to take out cash in a native currency.
Some cards waive those fees. Discover has no foreign transaction fee with any of its credit cards. Other credit cards offer rewards on travel-related purchases.
Similarly, if you are heading off to an out-of-state college or university, a travel rewards card or cash back rewards card could be helpful. By accumulating rewards on your purchases, you could make it home for a visit sooner than you think.
Student credit card drawback: You need to be a college student
When you apply for a student credit card, you may have to provide proof that you’re enrolled in college.
If you’ve graduated, or you’re no longer a student and you’d like to begin building a credit history, a secured credit card could be a valid option. It also can be a way to bounce back if you are looking to rebuild your credit history.
With a secured card, you pay a deposit upfront, which serves as your credit limit and covers the credit card company’s losses if you’re unable to pay your bill. If you demonstrate responsible credit management across all your cards and loans, you may qualify for an unsecured credit card, which is a more traditional credit card that does not require a deposit.
If you decide to apply for a secured credit card, you may want to choose one that reports to all three credit bureaus so you can establish or rebuild your credit history.
If you’re eligible, a student credit card could be a better option since it doesn’t require a deposit. However, if you’re no longer in school, pausing your classes, or you have poor credit, a secured credit card could be the way to go.
Earn top-tier rewards and build your credit history with a Discover student credit card1
![Discover it credit card]()
Student vs. regular credit card: What's the difference?
The primary difference between a student credit card and a regular credit card is what you need to be eligible. While consumer credit cards might have strict credit history and income requirements, student credit cards can be more forgiving.
Different eligibility criteria
Student credit cards and regular credit cards differ in their eligibility criteria, often reflecting their target audience. Remember that student cards are made for college students and often require proof of enrollment in a university. They’re for people with little to no credit history, making them available to young adults just beginning to learn about credit. For example, there is no credit score required to apply for Discover Student credit cards.3
Regular credit cards might require a credit history, with a good to excellent credit score being a common qualification. This requirement makes them less accessible to those just starting out, but more fitting for those with a record of managing credit responsibly.
Different credit limits
Credit limits on student credit cards and regular credit cards often reflect the different financial status and credit histories of their users. You might notice that a student card is made for small and emergency purchases rather than big spending.
For student credit cards, the limits are typically lower. They might range from $500 to $1,000 for new cardmembers. This takes into account that students have a lower income while managing classes. It also helps students to manage their spending by reducing the risk of accumulating large debts while they're learning about financial responsibility
Regular credit cards might offer higher credit limits. These limits might start anywhere from $2,000 to $5,000 for new cardmembers with good credit histories. The higher limits are based on the assumption that users of regular credit cards have a more established credit history and a proven ability to manage credit.
Different pricing structures
Student credit cards often have no or low annual fees. This can make them more affordable for students with limited budgets. However, they tend to have higher interest rates, as students usually have little to no credit history and might be a higher risk for lenders.
Regular credit cards may offer lower interest rates. These cards might require good to excellent credit for approval. Further, they might also have annual fees, particularly for cards with extensive rewards programs. These fees are often necessary for the benefits and lower interest rates offered to users with established credit.
Both student and regular credit cards may often begin with a zero or low introductory APR period, which then would increase to the standard rate once the period ends.
Different rewards & perks
Card issuers incentivize their customers through various credit card rewards programs, which include cash back programs, discounts on travel, meals, and other perks. If you’re using a student credit card vs a normal credit card, you may notice that the perks mirror the spending habits of students. For example, issuers offer rewards that include cash back on streaming services, food, and gas. When using a student credit card vs a normal card, your issuer may also provide introductory APR rates as low as 0%. This means you’ll pay no interest on any purchase until after a predetermined number of billing cycles. These can be valuable perks and are available even with a limited credit history.
Different credit building criteria
Credit building with a student credit card takes a different approach than with a regular credit card. If you’ve learned your credit score has a lasting impact on getting future loans, apartments, you know that building your credit early can help. If you’re comparing a student credit card and other consumer cards, you’ll see that student cards are best fit for beginners. While consumer credit cards come with stricter penalties, student credit cards might help educate students on the best ways to use credit cards and manage their money.
For instance, you might use your student credit card for small monthly expenses and pay the full balance each month. This is a way to gradually build a credit history. Regular cardmembers might use their card for a wider range of purchases and potentially carry a balance. This is because regular cardmembers can rely on established credit management skills to avoid high-interest charges and maintain a good credit score.
The bottom line
As students transition out of school and into the workforce, the good financial habits they developed with a student credit card could lead to good lifetime financial habits.
Then, you could use the solid credit history you established with the student credit card to rent a good apartment, get low-interest loans, and access more money for future savings.
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