There’s something both thrilling and frightening when searching for your first credit card.
Whether you’re looking to build up your credit or just want a card to use in case of emergencies, finding the best credit cards for students can be tricky.
Luckily, that’s where student credit cards come in. Made for novice credit card users just starting out in the world of personal finance, there’s a lot to like about credit cards made specifically with students in mind.
So if you’re thinking about turning in an application for your first credit card, here’s everything you need to know about student credit cards, how to spot the best deals, and what alternatives may be best for your situation.
Let’s start from the beginning
Now that you’re finally in college, you’re probably doing a lot of thinking about what lies in store for you the future. And, setting your sights on some goals to achieve.
But here’s a secret you probably won’t learn in your college classes: for a lot of those future goals, you’ll most likely need a credit score and history.
Here’s how it works.
Your spending and borrowing behavior is monitored by three main credit bureaus. They then assign you a score on a scale of 300 to 850 based on how you handle credit.
Having a history of regularly paying debts off helps you earn a good credit score. But that doesn’t mean you start off with a score of 850 for paying off your cell phone bill each month.
To get a credit score, you actually need at least six months’ worth of credit history, according to Credit.com. Therefore, six months of on-time cell phone bill payments will help you establish a credit score.
Essentially, the higher your credit score gets, the better your chances will be for getting better interest rates on loans or other credit options. This could potentially save you thousands of dollars in interest down the road.
The nitty-gritty of student credit cards
Created with new borrowers in mind, student credit cards are designed to work with low-income students who are doing well in school.
Some credit cards offered by various institutions may require you to be enrolled in a college program. Others are practically open to everyone.
For most student credit cards, you must be 18 years old to apply and have a social security number. Having a job with a steady stream of income also helps.
Some student credit cards may offer a very low-interest rate or a set period of no interest at all. Additionally, many do not have high annual fees that other “traditional” credit cards may charge.
They may also be more flexible in terms, such as setting your payment due date.
Other credit cards for college students give incentives and bonuses, such as points to use at campus bookstores, cash back rewards when you dine out, or donations in your name to the school.
Do you qualify for a student credit card?
Some of the best credit cards for students also allow for cosigners.
If you already have a cosigner on a student loan, you know that this is when a parent or person with an established credit history and score agrees to take responsibility for your debt if you do not pay.
And while cosigning isn’t for everyone, it’s a great option to have just in case. Especially if you are turned down for credit cards because of a lack of income or no credit history.
Finding the best credit cards for students
While it may be tempting to jump right in and apply for every single student credit card that comes your way, that may actually hurt your credit score.
Instead, do the research and evaluate each offer based on your needs before you hit submit on your application.
Start with the interest rate. Student credit cards usually offer minimal or competitive interest rates because borrowing limits are usually limited for new credit card holders. What’s more, many offer periods of no interest as well.
While you’re evaluating cost, scan for fees. Some credit card companies, believe it or not, charge card holders for getting paper statements in the mail. Make sure you avoid cards that seem to nickel and dime you for everything.
You’ll also want a way to monitor your credit usage. Keep an eye out for student credit cards that offer free access to your credit score, spending trackers, automated payment methods, and online banking.
If you’re still stuck deciding between a few student credit card offers, use reputable credit card sites to read professional reviews and see what others have to say.
Keep an eye out for customer service stories, too. Since, ideally, you’d like to hold on to your credit cards for some time, you’ll want to read positive stories about companies, not horror stories.
Alternative credit cards for college students
The truth is that even with all your research and time spent finding the right card, you may be turned down because of your lack of credit or employment history.
The good news is that you can still build your credit score and history while having access to credit by getting a secured credit card.
Unlike traditional credit cards, secured credit cards require you to put money down as collateral. And don’t worry, this deposit is refundable.
The catch is that the money you put down becomes (in most cases) your credit limit. So, if you put down $500, you will only be able to spend a max of $500 using your card. You then pay the balance back each month which ultimately builds your credit.
Secured cards look and act just like regular credit cards, so they’re accepted everywhere.
The other option is to forget the student credit card altogether and go straight for a traditional card. It’s an ideal route for those with a good work history throughout college, or those just about to graduate.
Making it work with a student credit card
Finding the best credit card for college students begins by evaluating needs and wants.
If you need to build your credit or want a lot of perks like no interest or points for everyday purchases, there’s a student credit card out there for you.
Start off by evaluating your individual situation and finding the credit building methods that work for you. Then you can find the best unsecured or secured credit card for students that fits your situation.
Interested in refinancing student loans?Here are the top 6 lenders of 2019!
|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 7.89% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.97% 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
|2.57% – 6.97%1||Undergrad & Graduate|
|2.47% – 6.99%3||Undergrad & Graduate|
|2.68% – 8.77%4||Undergrad & Graduate|
|3.24% – 6.66%2||Undergrad & Graduate|
|2.61% – 7.35%5||Undergrad & Graduate|
|3.01% – 9.75%6||Undergrad & Graduate|