Choosing the right charge card is serious business. Make sure you have the right one while you’re in college.
Credit cards are a necessity if you want to survive as a college student and not have to carry cash on you at all times. Many people, however, downplay the seriousness of getting a credit card in your name. Establishing credit is hugely important for when you want to buy a car, rent an apartment, or own a home down the road. Hurt your credit now, and it follows you for seven years.
Unfortunately, charge card companies want to take advantage of new students by scamming them into cards they’ll never be able to pay off, landing them hopelessly in debt and screwing their credit up for the foreseeable future—that’s where we come in. Use these tips to determine which credit card is right for you so you can pay for what you need and start establishing good credit.
Make sure it’s actually helping you build credit.
Most credit card companies now have cards designed specifically for students or secured cards, which are easy to qualify for. This is great, except you need to make sure that the card you’re getting helps to establish your credit. Be sure to check that the charge card company reports your payments to the three major credit bureaus—most cards don’t do this. You don’t want all of your on-time payments to go unnoticed.
Determine what’s most important to you: saving money or earning rewards.
If you’re getting a regular charge card instead of a student specific or secured card, you likely have one of two options when it comes to the bonus you receive: getting money back on qualified purchases/saving money on interest rates or earning points to spend on rewards. There are pros and cons to each. Getting a card that offers you the option to save money often has an annual fee you need to pay to stay enrolled and is usually better for bigger spenders. If you opt for a rewards program, the incentive is often tied to paying your bill off in full every month, and you should check how often you can spend your rewards points and on what items. Neither is right or wrong, but you need to make sure to choose the option that best suits your spending habits.
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Think about if you’re planning on traveling or studying abroad any time while you’re in college.
Certain charge cards are more widely accepted overseas than others, so if going abroad is in your future, find a card that doesn’t charge any fees for international transactions. The most widely accepted international charge cards in the US and abroad are MasterCard and Visa, and both have cards with no foreign transaction fees. If you’re not planning on going overseas, Discover has plenty of student cards that will start establishing credit and be widely accepted domestically.
There’s plenty of factors that come into play when deciding which charge card you want to sign up for while in college. Of course there’s no one size fits all, but the most important thing to do is not get in over your head and ruin your credit. Start slowly, and gradually take on a card with more responsibilities. Most credit card companies even have programs where you “graduate” to a better card with a higher credit limit after so many successful payments, so take your time and ease into the process!
Need more expert advice on college life? Check out our ultimate guide to all things college!