When comparing student credit cards, it's important to consider several key factors that will help you find a card that fits your financial needs and helps build your credit. Here are the main factors to look at:
1. Annual Percentage Rate (APR)
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What it is: The APR is the interest rate charged on any balances carried over from month to month.
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Why it matters: Lower APRs are better because you’ll pay less in interest if you carry a balance. However, if you plan to pay off your balance in full each month, APR may not be as important.
2. Fees
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What to look for: Some cards may have annual fees, late payment fees, or foreign transaction fees.
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Why it matters: Look for cards with low or no annual fees and avoid cards with high penalty fees, especially if you’re just starting out with credit.
3. Rewards Program
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What it is: Some student credit cards offer rewards like cash back, points, or miles for purchases.
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Why it matters: If you plan to use the card frequently, a rewards program can help you earn benefits like cashback or travel points.
4. Credit Limit
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What it is: This is the maximum amount you can charge on the card.
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Why it matters: A higher credit limit can help with your credit utilization ratio (the amount of credit used relative to the total credit limit). However, a lower limit might be more manageable for building responsible credit as a student.
5. Building Credit
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What to look for: Look for cards that report to all three major credit bureaus (Experian, Equifax, and TransUnion).
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Why it matters: Building credit early can help you in the future when applying for loans, car purchases, or a mortgage. A card that reports to all three bureaus helps you build a strong credit history.
6. Student-Specific Benefits
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What to look for: Some student credit cards come with perks tailored to students, such as educational resources, financial literacy tools, or the ability to upgrade to a non-student card after a certain period.
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Why it matters: These features can help you manage your credit responsibly and improve your financial habits.
7. Eligibility and Application Process
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What to look for: Many student cards are designed for people with limited or no credit history. Make sure you meet the card’s eligibility requirements.
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Why it matters: Some cards may require you to have a certain credit score or income level, so choose one that you’re eligible for.
8. Introductory Offers
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What it is: Some cards offer introductory 0% APR on purchases or balance transfers for the first few months.
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Why it matters: If you plan on making a large purchase or transferring a balance, this can be a great way to save on interest.
9. Additional Features
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What to look for: Some cards offer additional features like access to credit score tracking or fraud protection.
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Why it matters: These features can help you stay informed about your financial health and protect against unauthorized charges.
Popular Student Credit Cards to Consider:
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Discover it® Student Cash Back: Offers 5% cash back on rotating categories, 1% on all other purchases, and no annual fee.
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Chase Freedom® Student Credit Card: Offers 1% cash back on all purchases and a $50 bonus after your first purchase within the first 3 months.
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Capital One QuicksilverOne® Rewards for Students: 1.5% cash back on every purchase, with no annual fee.