Student Credit Cards: Their Advantages and Features4th March 2012
Student credit cards are a type of specialty card. They are designed specifically to address the needs of certain individuals - students. To take advantage of their features, students should first be enrolled in a course at a university or college, however.
Generally, consumer credit cards require a certain credit score for approval. Because for definite, many students from higher learning institutes like universities and colleges have not yet started with their credit history, they cannot apply for all other types of credit cards unless they become a supplementary credit card holder of their parents. The credit score is simply not a requirement in applying for a student credit card.
Benefits of credit cards
Student credit cards are for current college or university students. These cards assist them as they go through their studies without the unnecessary, yet inevitable financial worries. The benefits of having a student credit card are many. However, the greatest of them are listed below:
- Security. A credit card works by using it as a tool to purchase merchandises either online, on the telephone, or in stores. Students do not have to carry large sums of money to shop for their needs. When there is a robbery, the students will not regret handing over their wallet or bag with credit cards on it because the cards themselves are protected from theft. Of course, this is assuming the students did not bring with them other valuables like jewelry or large amount of cash.
- Emergency fund. There are credit cards for students that allow cash advances via ATM withdrawal. This spells a blessing especially if the students need cash for something which cannot be covered by a credit card.
- It helps in financial management. The banks understand that students do not have the financial capacity yet. Thus, these credit cards have a lower credit limit. In relation to this, the students must know how to wisely make use of the said limited credit limit. Students will learn the significance of paying for their credit card bills on time. Thereby, helping to mold them into responsible individuals.
- A good way to build up their credit history. A credit history contains a comprehensive report about a consumer's borrowing and payment activities. It is rated by a score. A person's credit score will have an impact in their life. It is considered when one try's to obtain a loan, mortgage, credit card or any other type of credit for that matter. Even in finding a job, the credit history is sometimes considered. Students can take advantage of this opportunity to start building their credit history. They must remember to pay their monthly dues on time as much as possible. The lower credit limit of their credit cards also works to their advantage because students will not be able to get themselves into serious debts.
Features of Student Credit Cards
Generally, credit cards for students can be a Visa or MasterCard like any other regular consumer cards. Although these cards have scaled back rewards compared to consumer cards, these cards are a useful commodity in many ways. Here is some of what to expect from a student credit card:
- Rewards. The rewards range from discounts at selected stores to freebies. The card may have a points reward scheme. Points are accumulated from every purchase made using the card. When these points reached a certain number, they can be redeemed for shopping vouchers, tickets to events or to use at when eating out, whichever is specified on the credit card.
- Exclusive Perks. There are establishments that provide complimentary stuffs to certain credit card holders including student credit cards. Examples are gift certificates, complimentary drinks in certain hotels or restaurants or signature items.
- Cash Advance. For emergency purpose, some student credit cards offer this feature. The rule of cash amount that can be withdrawn is incumbent upon the bank, however. Some cards allow as much as 75% of the total credit limit.
- Balance transfer. There are instances in which students may find another credit card with better offers than what they currently have. Should they be interested in switching to that credit card, they are allowed to transfer the balance from the old credit card to the new one.
When managed and used properly, credit card for students can be a good way to start building a bright future.