Why a Student Credit Card?

As a student you are constantly being asked to pay for things; a few hundred dollars for books, thousands more for tuition and room, and the remaining few bucks in your bank account for groceries and the occasional cup of coffee. However, unlike the credit cards your parents were stuck with back in college, a Student Credit Card rewards you for spending, allowing you to rack up points which can be redeemed for prizes or cash back, all for spending the money you were already going to spend.

All Student Credit Cards offer some sort of reimbursement for spending. Some give a percentage of what was spent back—usually between one and three percent—while others offer points for every dollar spent. Unlike the cash back, which is simply put back into your account at the end of the month, points are collected and can be traded in for prizes ranging from gift cards to iPods to airline tickets. While both options are valid, we found the point reward system to be more gratifying. Points are usually offered in larger amounts, making them quicker to accumulate and trade in.

The best part about Student Credit Cards is the vast amount of places at which they can be used for points or cash back. A good card will reward you for using your card anywhere, but will offer larger rewards if you make a purchase at a book store—including a university bookstore—restaurant, gas station, movie theater, super market or drug store; all popular consumer locations for the student population.

What to look for in Student Credit Cards

Student Credit Cards were designed with two purposes in mind: To make the pain of dropping a few thousand dollars in one semester easier, and to teach young adults how to properly use credit. A good Student Credit Card will offer a low APR (Annual Percentage Rate), a high grace period for which you can make your payment, and resources to help better track your financial situation such as a budget calculator or free credit lesson.

We found that a good Student Credit Card will offer some sort of reward system for making payments on time and not exceeding the credit limit. This usually comes with a reduced APR or bonus points. A good Student Credit Card will also offer rewards for achieving a good GPA. Seeing as this is the essence of being a student, we believe this feature should stand above the rest.

However, there are many components which make up a good Student Credit Card, all of which are listed below.

APR For Purchase
Annual Percentage Rate is the amount you’ll have to pay in interest for using credit. A good Student Credit Card will offer an introduction period of 0% APR before taking on their usual APR. It goes without saying that a low APR is ideal. Good Student Credit Cards will also offer no annual fees and a longer grace period.

Points for Card Use
One of the greatest appeals of a Student Credit Card is the rewards system. All student credit cards offer two types of rewards, points and cash back. Points can be collected through use of the card and redeemed for a plethora of treats, ranging from CDs to concert tickets to airline tickets. Cash back rewards simply give you a percentage of what you’ve spent each month back. Look for a Student Credit Card that offers high point and cash back value for a high GPA, use of the card at gas stations, restaurants, book stores, and for paying bills on time.

Who it’s for
Most Student Credit Cards are geared toward the college level. They offer rewards for spending at places college students frequent, such as book stores, restaurants, movie theaters, gas stations, etc. All Student Credit Cards require the user to be at least 18 years of age, and some even require proof of enrollment in an accredited college or university.

Additional Features
A Student Credit Card should offer free online access and account management. This makes paying off your line of credit and moving your money around very easy. We also found that a good Student Credit Card offers credit limit alerts which warn the user if they’re going to exceed their credit limit or if a payment is due soon. Budget/Credit education is also an important feature. This is usually offered through the credit card’s homepage.

Fees and Charges
It is inevitable, if you exceed your credit limit or make a late payment there will be a fee tacked onto your bill, no getting around it. However, searching out the lowest fees can make this less painful. Most Over Credit Limit Fees are in the range of $29 to $39. Other fees include Cash Advance Fees, Balance Transfer Fees, and Purchases outside the U.S. Fees.

Help/Support
The last thing a student wants is to be standing at a gas pump in the middle of No Where with a card that is continually being declined. To ensure this doesn’t happen to you, we recommend a Student Credit Card that offers 24/7 phone support and solid business hour support. It is also important that Student Credit Cards offer an FAQ section and email support.

While we do advocate Student Credit Cards as being a superb tool for students, we would also like to stress the importance of managing your money. The misconception that tends to accompany credit cards is that you suddenly have free money, this is not the case. Exceeding your credit limit does come with a fee, and missing payments will, without fail, raise your APR. Proper budgeting will ensure you stay within your means and do not run your credit score into the ground. Check out the reviews of out top-ranked products, Citi mtvU, Discover Student Card and Citi FORWARD.

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