As students spend their college career preparing to make their way in the world, it’s also a critical time in their financial lives — a time when they can establish good financial behaviors and the beginnings of a credit history. A student credit card can be a good way to do that, as long as you don’t give in to all the temptations a line of credit can offer and become deeply indebted at a young age. However, a student card can also be a great opportunity to learn how to use credit responsibly, and build a good credit history that can help you qualify for car and home loans in the future, as well as help you qualify for more competitive rewards cards once you graduate.
What to Look for in a Student Credit Card
Most of the major credit card issuers offer products that are directly marketed to students. First, you should look for cards with the fewest fees. Thankfully, all of the student cards we reviewed have no annual fee, and some will even waive other fees.
Another feature to look for are benefits — including travel insurance and purchase protection policies. Students who travel internationally on study abroad programs will also look for a card with no foreign transaction fees and an EMV smart chip for compatibility with the next generation of credit card terminals already in use in other countries.
Those who might need to carry a balance will want to see low interest rates, and possibly a 0% APR introductory financing offer. Those who don’t carry a balance should consider one of the student cards that offer rewards for spending. In fact, some of the leading rewards credit cards are offered in a version for students that features the exact same reward programs as the standard version.
This is also a good time to get in the habit of checking your credit reports and credit scores regularly. By checking your credit reports, you can ensure they’re accurate and spot patterns in your credit behaviors that could be hurting your credit scores. You can get your credit reports for free every year from AnnualCreditReport.com. And there are free tools at Credit.com which give you two credit scores and an overview of your credit profile — updated every month. This can help you track your progress as you build credit.
The Winner: BankAmericard Travel Rewards for Students
This card offers all of the features of a leading travel rewards card, in a version just for students.
Why it won: This card has a strong sign-up bonus, introductory financing offer, a decent interest rate and low fees.
The benefits: This card offers 1.5 points per dollar spent, which can be redeemed to pay for flights, hotels, vacation packages, cruises, rental cars or baggage fees with no restrictions or blackout dates. In addition, new cardholders can earn 10,000 bonus points when they make at least $500 in purchases in the first 90 days, which is worth $100 as a statement credit towards travel purchases. It also comes with 12 months of interest-free financing on both new purchases and balance transfers.
The costs: Even though this card offers 0% APR balance transfers, there is a 3% balance transfer fee. After the promotional financing expires, the standard interest rate is 14.99-22.99%, depending on the applicant’s credit history. There is no annual fee or foreign transaction fees with this card.
1st Runner-Up: Discover it for Students
Why it won: The Discover it card for college students offers all of the same benefits and rewards as the standard Discover card.
The benefits: This card offers 1% cash back on all purchases, and an additional 4% cash back on purchases from select categories of merchants that change each quarter. Other benefits include a free FICO score online and on monthly statements, and emergency travel assistance.
The costs: The standard interest rate is 12.99%-21.99%, depending on the cardholder’s credit worthiness. Cardholders receive their first late fee waived automatically, and there is no penalty interest rate. There is no annual fee or foreign transaction fees with this card.
2nd Runner-Up: BankAmericard Better Balance Rewards
Why it won: This card offers many of the same excellent terms as the winner, but with an innovative program that rewards students for using their card responsibly, instead of travel rewards.
The benefits: Cardholders can earn $25 per quarter when their payments exceed the monthly minimum, plus another $5 bonus per quarter for those who also hold a checking or savings account with Bank of America. In addition, new applicants receive 12 months of interest-free financing on both new purchases and balance transfers.
The costs: The standard interest rate is 11.99-21.99%, depending on the customer’s credit history. There is no annual fee for this card, but there is a 3% balance transfer fee and a 3% foreign transaction fee.
Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.
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