Nothing makes an eighteen year old feel like they have crossed over the threshold from teenager to adult than to apply for and be granted a credit card of their own. With the credit card companies eager to sign up students and students eager for their own credit card, the whole process can get out of control.
A student should make a decision to have only one credit card during their college years. A single credit card will suffice for all your expenses if used wisely. A student shouldn't be talked into applying for a credit card on the spot because of some slick salesman on campus or the free merchandise they are offering. Ask for literature about the card. If you have set a goal of only one credit card then you will be less tempted to apply for every card that is offered to you. Take the time to research which credit card is best for you. One of the best ways to research credit cards is on the internet.
There are many websites that offer reviews and comparisons of various credit cards. You can search for credit cards aimed at college students as these would be easiest to obtain. Then, pick out a few that meet your needs and most websites offer side by side comparisons. This will allow you to see what a credit card offers and does not offer as compares to other cards. Then, and only then, you can confidently apply for the credit card that best meets your needs.
There are certain features that a college student should pay attention to when researching credit card options. First, and most important, is the APR, or annual percentage rate. This is the interest you are going to pay on any balance you carry. Many cards will offer a zero percent or very small interest rate in their initial offers. However, that rate is usually an introductory rate and after a designated period of time the rate will increase. This increase could be the average of most credit cards anywhere from ten to twenty percent; but, it could also increase to 25% up to 29%. That means you could end up paying more in interest than the original purchase. Second, you want to read the terms of the credit contract for fees. You want a card that doesn't charge an annual fee, or an enrollment fee, or any other fees that strictly mean money out of your pocket and pure profit for the credit card company.
Finally, you may want to consider a card with rewards. Just be aware that a card offering rewards will generally have a higher interest rate. If you are confident that you will use your card prudently and pay the entire balance every month, and then interest rates don't need to be your foremost concern and you could opt for a credit card with a rewards program. Some student credit cards that have reward programs are:
- DISCOVER -- offers cash back rewards when you pay your balance in full every month. That means you are building great credit history, have no debt hanging over your head, and getting a little money back in your pocket.
- CITI DRIVER'S EDGE CARD -- This credit card for college students offers rebates that can be used towards the purchase of an automobile.
- CITI mtvU PLATINUM SELECT CARD – offers multiple points for each dollar spent in specific retailers and one point per dollar in all other spending. It also rewards good students with 2000 points twice a year for the cumulative GPA. Finally, it offers 25 reward points each month that a student exercises good money management.
- CITI FORWARD STUDENT CARD – This card also offers reward points for good credit behavior. You receive 100 points each month that the bill is paid on time and remains under your credit limit. If you elect for paperless billing and use the card responsibly for three months you will earn 8000 points.
If you are someone who has control over impulse spending and plans on paying your credit card bill in full on time, then a rewards program may be your best choice. It gives you incentives to use your credit wisely and the best reward of all will be a solid credit history and respectable credit score to start your post college life.
