subject: All You Need to Know About Student Credit Cards [print this page] Author: Cornie Herring Author: Cornie Herring
Student credit cards can be beneficial to provide cash for students who need the money immediately while providing convenient of cashless purchases like standard credit cards. But, it can also lead a student to get into a debt problem if they don't use it responsibly. Therefore, if you are interested in applying one of these cards, you have to understand the pros and cons of owning one of these cards.
Which credit cards should students go for?
College students are huge and profitable market for finance companies. They try to lure these students with very attractive offers like lowest interest rates, free application with zero annual fees. But, some of these offers come with hidden costs or high interest rate after the promotion period. You have to read the details of fine print in the agreement before you sign up any offer. It is advisable to go for the reputed companies, which have been offering student credit cards with proven tracked records.
What are the basics of student credit card?
Most often, student credit card is the first credit line for a student. Many of them are inexperienced and over enthusiastic to own the plastic card that may cause them to use the card haphazardly. Survey results found that an average college students cross a credit limit of USD7,000 and more than 60% of students owns more than one card. These students can be trapped into a debt problem if they or their parents don't have ability to pay the bills. Therefore, students should beware of the seriousness of jeopardizing their credit history that will affect their future credit worthiness. These cards are not an alternative to a study loan and they should not use it to cover the education cost. Alternatively, it should be used as the substitute for pocket money or when they need immediate cash for urgent matters.
Students above the age of 18 years are eligible to apply for a student credit card. Generally, the credit limit ranges from $500 to $1000. There are many benefits, which are not found in a standard credit card. These benefits include:
1. Lower interest rate. The interest rate can be as low as 10%, which is much lower than the 18% of standard card.
2. No credit history needed. Some issuers may require the parent to co-sign the card in order to minimize the risk of students not paying their bill payment on time.
3. The best student credit card offers may come with 0% APR. So, you should search and compare a few offers before finalize the one that you think it is the best for you.
4. Most student credit cards are come without an annual fee. You can use the card to avail gasoline, book tickets or purchase online.
Although there are many advantages, which partly mentioned above, there are some disadvantages that you should know before owning the card. Since the student credit cards can be used in the same way as other card are, the lack of experience in using it may cause the students fail to manage their finances competently and get caught into a debt problem. Therefore, you should use the card responsibly and make payments on-time to avoid the risk of trapping into a debt problem.
Summary
Students will benefit on the convenient of getting a student credit card, but they have to use it responsibly and manage their finance properly while enjoying the advantages provided by the card.About the Author:
Visit Cornie Herring's website at http://www.studykiosk.com/CreditBasics to find more debt relief resources on the option available for you to get rid of debt. Learn how debt consolidation, credit counseling and other debt solutions work in helping debtors to resolve their debt issues.
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