Discover... Chase... Bank of America... Capital One. If you're in the market for a student credit card, you have a lot of choices. To find the right card for you, you'll want to check each card's fees, annual percentage rate (APR), eligibility requirements, and rewards. By reviewing this student credit card information, you can make a smart decision.
- Many major card issuers—including Bank of America, Chase, and Discover—offer student credit cards.
- Easier to get than other credit cards, a student credit card can help you establish your credit while still in school.
- Some student credit cards also offer added benefits like rewards or travel insurance.
- Student credit cards often have high annual percentage rates (APRs) and fees.
- Eligibility requirements vary by card issuer.
How Student Credit Cards Work
Designed specifically for young adults who are currently in college and working toward a degree, student credit cards function like traditional credit cards. However, they are usually easier to qualify for, making them a practical option when you're a student and just starting to build your credit.
What Student Credit Card Information to Consider
There are many different student credit cards on the market today. When comparing your options, it helps to consider the following factors:
1. Annual Percentage Rate (APR)
Unfortunately, the annual percentage rate, or APR, on some student credit cards can be quite high; rates well into the double digits are common. If you don't pay your balance in full each month, a higher APR will cause more interest to accrue, making it more difficult to pay down your debt.
So if you think you may carry a balance, because of a major upcoming expense, for example, look for a card with a lower APR.
Some student credit cards charge additional fees, such as annual fees or account setup fees. There are many no-fee cards on the market, so there's no need to waste money on one that charges added fees, especially when you're a college student on a budget. For instance, the Deserve EDU Mastercard for Students card doesn't have an annual fee, setup fee, or monthly maintenance fees.
3. Applicant Requirements
Applicant requirements vary by card issuer. In general, you must be at least 18, have a Social Security number, and have either your own income or a cosigner with a reliable income to qualify.
Most card issuers require applicants to be current college students. They may ask you for proof of enrollment, including your expected graduation date. However, not all issuers have that requirement. For example, the Journey Student Credit Card from Capital One does not ask for proof of enrollment, so you could qualify even if you aren't in college.
With some student credit cards, you can earn rewards on select purchases. For example, you'd earn 1.5 points for every $1 you spend with the Bank of America Travel Rewards for Students credit card. You can redeem your points for statement credits that you can use to pay for flights, hotel stays, rental cars, or baggage fees.
The most common forms of credit card rewards are cash back, points, and airline miles. If you're interested in a card with rewards, look for one that offers rewards you'll actually use; for example, a card that gives cash back might be more useful than one that offers airline miles. You could use your cash back to pay for textbooks and other school expenses.
5. Spending Categories for Rewards
While some cards provide rewards on every purchase, others offer them only in certain spending categories, such as gas, groceries, or meals at restaurants. If rewards are important to you, make sure you can earn them on the kinds of purchases you routinely make. Otherwise, it may be better to look for a card that offers a flat rewards rate on everything.
One option is the Chase Freedom Student Credit Card. It pays 1% cash back on all purchases, and there is no cap on how much you can earn.
6. Eligibility for Cards After Graduation
What happens to your account when you graduate varies by card issuer. Some card issuers will require you to submit a new application for another credit card, while others will immediately transfer your student account to a standard card.
For the simplest transition, look for a card that will graduate with you. With the Discover it Student Cash Back Credit Card, for example, after graduation cardholders will have the Discover it® Cash Back credit card.
If you're unable to qualify for a student credit card, a secured credit card could be another option.
The Bottom Line
There are many student credit cards on the market, so it's worth spending some time researching the available options and thinking about how you plan to use the card. By focusing on your spending habits and budget, you can find the student credit card that's the best match for you.