Credit cards for students often provide young people with their first opportunity to gain financial experience and create a credit history. Students under the age of 21 must have a co-signer or be able to independently repay debt when applying for a credit card. A number of companies offer student-oriented credit card accounts. Interest rates and features can change, so be sure to check current figures and features before signing up.
Discover It Chrome Student Card
Features
This card has no annual fee and offers a reward for good grades. The cardholder gets a $20 cash rebate for each school year his or her GPA is 3.0 or higher for up to five years. New card holders get an introductory 0% APR for the first six months, then the rate will increase to 13.24% to 22.24% depending on creditworthiness.
Restrictions
To be eligible for this card, the applicant must be enrolled as a college student. Applicants are considered based on creditworthiness and must provide information on employment, bank accounts and credit report. Applicants need a good credit score (690 or higher). To apply by phone, you must be over 21.
Security features
The cardholder can freeze the account using a mobile app or online to prevent new purchases if the card is stolen or lost.
Pros
Earn 2% cash back at restaurants and gas stations up to $1,000 in combined purchases.
receive unlimited 1% cash back on all other purchases.
New cardholders get a dollar-for-dollar match for all cash back earned at the end of the first year.
Late fees are waived for the first occurrence. There is a fee of $37 for late payments after that.
There are no foreign transaction fees.
Approved card holders will get at least a $500 credit line.
Your FICO score is provided on your monthly statements.
Cons
Must be a college student to apply
Must have a good credit rating (690 or higher)
How to Apply
Apply online at Discover or by mail or phone (800-983-1307)
BankAmericard Credit Card for Students
Features
This card is ideal for first timer cardholders. It offers an introductory 0% APR and requires no credit history, so it will benefit those who want to establish or rebuild credit.
Restrictions
Age minimum is 18 years. No credit history is needed to apply.
Security Features
This card offers free ShopSafe service for online shopping. This service creates a temporary credit card number so the real account information remains private.
Pros
There is no annual fee
The introductory APR is 0% for the first 18 billing cycles, then ranges from 11.24% to 21.24%.
Balance transfers are applied at 0% APR if made within the first 60 days.
Cons
There is a 3% foreign transaction fee for purchases outside of the U.S.
There is a balance transfer fee of either 3% of the amount or $10, whichever is greater.
This is not a reward card so there is no program for cash back or rebates.
Penalties and fees
Late payment fee of up to $37.
Returned payment fee of up to $27.
How to Apply
Apply online at Bank of America or by mail or in-person at branch locations.
Capital One Journey Student Rewards Credit Card
Features
This a reward card with no annual fee that has a cash back incentive for paying on time. There is also an increase in the credit line after five months of on time payments (the minimum credit line is $300 when approved). Rewards can be used for statement credit or cash back.
Restrictions
The minimum age is 18. An average credit score is needed to qualify.
Pros
There is no annual fee.
No foreign transaction fees apply.
You can select the preferred due date for billing.
Earn 1% cash back on all purchases plus a bonus reward of .25% for paying on time. (A reward total of 1.25% is a good incentive for maintaining on time bill paying.)
Cons
The APR is high at 20.24%.
This account has no introductory reduced interest rate for new cardholders.
How to Apply
Apply at online at Capital One or by mail or phone (800-695-5500) or in person at branch locations
Citi ThankYou Preferred Card for College Students
Features
The Citi ThankYou Preferred Card for College Students has a 0% introductory APR for seven months, then a variable APR ranging from 14.24% to 24.24% based on creditworthiness. New cardholders will earn 2,500 bonus ThankYou points after spending $500 in purchases within the first three months. The card is best suited for those who use the rewards and pay the full statement balance on time.
Restrictions
Need a good credit score to apply (690 or higher). The minimum age is 18.
Pros
There is no annual fee.
Earn 2 ThankYou Points per dollar spent on purchases for dining and entertainment.
Earn 1 point per dollar on all other purchases.
Redeem points for travel, gift cards, cash, etc.
Get membership to the Citi Private Pass program, which allows special access to concerts and events.
Travel accident insurance and car rental insurance are included.
Cons
The regular APR can be as high as 24.24%.
The penalty for making a late payment is $35. That could bump the APR to 29.99%.
The foreign transaction fee is 3% of each purchase.
How to Apply
Apply by mail or phone (866-940-3276) or online at Citi.
Wells Fargo Cash Back College Visa
Features
Cardholders earn cash back rewards on all purchases. Get a 3% cash reward for gas, grocery and drugstore purchases during the first six months, then earn a 1% cash reward for all purchases. This credit card is good for those who are trying to establish credit because it accepts people with low credit scores.
Restrictions
Need fair credit score to apply (650 or higher).
Pros
There is no annual fee.
The introductory APR is 0% for first six months, then varies from 11.40% to 21.40% based on creditworthiness.
Pay monthly cell phone bills with this card and it offers $600 protection against damage or theft of the cell phone.
Rewards can be used to make a deposit into a Wells Fargo savings account or redeemed for travel and merchandise.
Cons
The foreign transaction fee is 3%.
Ther are no introductory bonus rewards.
How to Apply
Apply by mail, or in person at branch locations or online at Wells Fargo.
Basic Credit Card Tips for Students
While credit cards can be beneficial to students, they aren't without risk. Follow these key tips to use your card wisely.
Review the account's terms and conditions before applying.
Pay the full balance on time each month to avoid interest rate and penalties.
Don't max out the credit spending limits each month.
Avoid taking cash advances.
Don't open more than one or two credit card accounts.
Review all fees, especially any ATM charges for cash withdrawals.
Key Regulations
There are important federal regulations governing student credit cards. In 2009, the Credit Card Accountability, Responsibility and Disclosure Act (Credit CARD Act) set stricter regulations for those lenders offering credit cards to young people.
Important Considerations
Selecting a credit card is part of the journey toward financial responsibility, along with other essential financial steps such as building a savings account and maintaining a budget. Credit cards are valuable tools that provide lessons in money management and help to establish a credit history for future events such as car loans and renting an apartment. However, credit card use without responsibility can lead to overspending and debt problems. A credit card purchase is really a short term loan with the obligation to pay the full balance each month or incur a high interest rate. Determine the best credit card for your financial situation and use it wisely.
