Just about any student credit card can help you build credit. But getting the right one can mean earning extra perks and bonus rewards on things you buy every day.
If you’re interested in getting a Discover student credit card, you’re on the right track. But there are two cards, so you’ll need to compare their features and your spending habits to find out which ones is best for you.
Discover student credit cards review
There are two Discover student credit card options: the Discover it for Students and the Discover it Chrome for Students.
For the most part, these cards have the same features. The only differences are in their rewards structures. Here’s how they break down:
Neither card charges an annual fee, which is essential for a starter card. Here are some other perks you’ll get with both cards:
- Cash-back match: Discover will match all the cash back you earn during the first year. So, if you earn $50 during the first year you have the card, you’ll get a $50 bonus on your anniversary.
- Rewards for good grades: You’ll get $20 in cash back each year your GPA is 3.0 or higher.
- Introductory APR promotion: You’ll pay a 0% APR on purchases for the first six months.
- Free FICO credit score: Using a credit card is a great way to build your credit as long as you’re paying off your bill in full each month. With free access to your FICO score, you can see how your actions help or hurt your credit.
How to pick the right Discover student credit card
Because these cards are so similar, the main question is how you spend your money.
As a college student, you might think that sounds like a joke. After all, you need to have money to spend it, right?
But if you take a step back, you might see there’s an opportunity to earn bonus rewards on some of your purchases.
For example, the Discover it Chrome for Students card is focused on rewarding restaurant and gas station purchases. Take a look at your expenses in these categories for the last couple of months and tally up how much you spent on those categories.
Then, multiply the monthly amount by 2 percent (0.02) to see how much you would’ve earned on those purchases. If you think the amount is significant enough, the card is worth considering.
For example, say you spend $500 per month on your credit card, with $200 of it going to restaurant and gas station purchases. Here’s how your rewards will break down:
$200 x 2 percent = $4
$300 x 1 percent = $3
Total cash back rewards per month = $7
With the Discover it for Students, things can get more complicated. Since the card’s bonus categories change every three months, you have to review your spending for multiple categories to see if the card is worth it.
Here’s the full 2017 cash-back calendar:
Note that two of the categories are gas stations and restaurants. The only drawback is that they’re not bonus categories all year long like they are with the Discover it Chrome for Students.
The good news is even if you don’t spend as much on these other categories as you do on gas stations and restaurants, you’re getting 5 percent cash back rather than 2 percent.
So, if you spend $500 on Amazon during the fourth quarter of 2017, you’ll get $25 cash back. You’d have to spend $1,250 at gas stations and restaurants with the Discover it Chrome for Students to get the same amount.
Picking the best Discover credit card for students ultimately comes down to your spending habits and a judgment call.
How to use your Discover student credit card
Once you’ve chosen the right Discover student credit card for you, it’s critical to learn good credit habits to avoid losing money. For example, paying interest can wipe out any of the value you’re getting from the card’s rewards.
Here are some habits to develop once you get your card.
Pay off your balance in full each month
Despite what you might hear, there’s no benefit to carrying even a small balance on your credit card. You can build credit without paying a dime in interest as long as you pay your balance on time and in full each month.
Set up autopay
Between classes, studying, work, and socializing, college students have a lot on their plates. To avoid accidentally forgetting to make a payment, set up automatic payments from your checking account.
Get on a budget
The danger of overspending with a credit card is real. Even with a small credit limit, you can end up charging more to the card than you can pay off if you’re not paying attention.
To simplify things, use a budgeting app to track your purchases and set limits on spending.
Stay well below your credit limit
How much you owe makes up a sizable chunk of your credit score. If you have a high balance on your credit card, it can signal that you’re using too much credit. Try to keep your balance below 30 percent of your credit limit to avoid a credit ding.
If you follow these tips, you’ll be on your way to building your credit from scratch and earning solid rewards along the way, regardless of which card you choose.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
|Lender||Variable APR||Eligible Degrees|
|Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 6.97% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.30% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at firstname.lastname@example.org, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.
Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown.
All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.28% effective October 10, 2018.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate|
|2.47% – 6.30%1||Undergrad & Graduate|
|2.51% – 8.09%4||Undergrad & Graduate|
|3.02% – 6.44%2||Undergrad & Graduate|
|2.69% – 7.21%5||Undergrad & Graduate|
|2.79% – 8.39%6||Undergrad & Graduate|