How to Choose the Best Student Credit Card

If you are a student and looking to apply for your very first credit card, then you need to be careful.

There are predatory credit card companies out there who are looking to exploit the fact that this is your first time applying for a card. They are hoping that you will be so excited about the prospect of getting your first card that you will ignore the outrageous fees that they charge.

Students can be easy "marks" for these companies. These companies can, more often than not, get away with charging outrageous annual fees, interest rates and usage fees because many students just don't know any better.

Let's take an average student. We'll call him Joe.

Joe is moving away to college and needs a credit card for various reasons.

He applies at a number of different places and is rejected due to having basically no credit history.

He is walking through campus one day and sees a credit card company operating a stand. The company is handing out free shirts, and promises that Joe will be accepted if he applies.

Joe, needing a credit card, applies on the spot and is later accepted.

What Joe doesn't realize is that he is going to be charged outrageous fees to use this card. Joe was so anxious to get his own credit card that he didn't even bother to ask about the company's fees and interest rates.

Sound familiar?

The good news is that there are reputable companies out there who have cards that are specifically designed for students.

One of these companies is Discover.

Discover offers their Discover Student Card, which offers the following to students:

1. Zero annual fees.
2. 0% APR on all purchases for up to eight months.

After your eight month 0% APR period ends, Discover will charge you 14.99% APR, which I think you will find to be quite reasonable in this day and age (compared to other credit card companies).

When choosing a student credit card, you need to find out the following things:

1. Do they charge annual fees? Annual fees should NOT be a part of any student credit card offer.

2. What are their interest rates, especially after any 0% APR period ends?

3. Are there any other hidden fees that you should be made aware of?

4. Is the company itself reputable? (a simple search on Google will answer this question for you)

5. Is the company being very aggressive when it comes to you signing up for a card? This should be a red flag.

Companies should be cutting you a break on fees because you are a student. Unfortunately, many companies do just the opposite.

We can recommend the Discover Student Card if you are a student who is looking to apply for their very first credit card.


Filed under: Company Reviews