Using a credit card while in college can actually bring a lot of benefits. To reap these benefits however, a student credit cardholder must learn how to use his/her account responsibly. Listed below are reasons why students must consider getting a credit card:

1. Establish and build early credit history.

Building early credit history is a solid proof of creditworthiness. In fact, length of credit history makes up 10% of your total credit score. As a student, you are presented with a lot of opportunities to get a credit card with a good deal. This is the only time you can acquire an unsecured credit card despite the absence of credit history.

1. Firsthand training in credit and repayment.

Experience is the best teacher. Through guidance from parents or guardians, students can avoid the risks associated with wrong credit card use as they are given the chance to manage their own account. By the time a student graduates from college, he/she will be more equipped in managing personal finance.

1. A student credit card serves as a financial cushion.

Having a student credit card can come in handy when emergency expenses arise and cash is not readily available. Of course, this does not justify the use of credit card on unplanned or unimportant purchases. On the contrary, a credit card can provide the much-needed support that a student needs during tough times.

1. A safer way of payment.

Although the risks cannot be completely eliminated, a credit card can be considered as a safer method of payment than cash. Carrying cash can be a hassle and can be stolen right away. On the contrary, in case your student credit card gets lost or stolen, you can call up your issuer to have the account blocked against unauthorized use.

1. Preparation for the future.

If you can establish early credit history and keep your credit rating in an excellent standing, you will surely enjoy even more advantages. First, you can get access to better loan deals if you need to apply for loans (car loan, personal loan) later on. You can request your student loan lenders for a reduced rate of interest if you can show an impressive credit history.

In fact, lenders are not the only ones who are interested about your personal credit. Even landlords and rental companies may strictly require good credit. If you have solid credit, you can choose any place you want and you can get approved as a tenant more easily.

Many companies conduct pre-employment credit screening to check a candidate’s credibility and background. Pre-employment credit check is to be expected especially for accountants and other positions that involve the direct handling of money. If you have an excellent credit standing, you will surely gain an edge over your competitors.

After getting approved, the student can expect to receive his/her credit card through mail within 4-5 banking days. Upon receipt of the student credit card, the cardholder must call the issuer to verify his/her identification before the credit card can be activated and used for transactions.

Clearly, applying for your first credit card in college is quick and easy. However, you should be aware that new Credit CARD law prohibits credit card companies from accepting applicants who are below the minimum age requirement unless they have a co-signer.

If you are under 21 years old, be sure to ask your parent or guardian to co-sign the account for you. Furthermore, choose a co-signer with good credit history to get approved right away. On the other hand, even if you are below 21 years old and yet you can show proof of independent income, you may be able to get a student credit card even without co-signer. Still, most students who are in college are financially dependent to their parents and thus, the need for a co-signer.

Use Your Instant Approval Student Credit Card to Build Good Credit

For non-students, instant approval cards strictly require good or above-average credit score. People with bad credit or who have a low credit score must go for a secured credit card. However, students have the privilege to get instant approval since that they have yet to build their personal credit history.

Therefore, use your instant approval student credit card to establish and build good credit. How? Good credit can be achieved by using your student credit card to pay for items that you need for school and by paying off your balances on time.

Take note that most credit cards for students start with a low credit limit so you need to watch out your spending. Instead of maximizing your credit line, keep your spending minimal or at least below 50% of your borrowing limit. By doing so, you will find it easier to manage your debts and repayment. More importantly, you can protect yourself from the risk of bad credit.

About the Author

Samantha Wilson is a consultant for credit cards for students. For years she has written student credit card articles that would help build student credit.

Copyright 2010

Many students found themselves in huge debt because of online gambling. Playing on-line using a student credit card can be a tempting hobby but you’ll also be putting your credit online.

3. Using student credit cards for shopping or dining
It is so convenient to go shopping or dine in a restaurant with your friends using your credit card. Unfortunately, this is also a quick and easy way to get stuck in debt. Many students do not realize that they’re already over spending until it’s too late.
4. Carrying a balance

Student credit cards can come with as much as 15% interest rate. A student who’s in the habit of carrying a balance on his account will undoubtedly find himself paying for more interest than he can afford.

5. Opening store credit cards to avail of discount

Many stores offer a store credit card in exchange for discounts. This may seem like a great way to save on your shopping. Don’t forget that despite the discounts, these cards come with high interest rates. Unfortunately, some students make the mistake of opening too many store credit cards at every boutique they shop. As a result, their spending gets out of control and their credit history is damaged.

6. Not paying on time

Students often fail to pay their balances on time. Thus, these students end up paying for high interest rates and penalty charges.

7. Using the credit card to buy an engagement ring

Many students used their credit card to buy a very expensive diamond engagement ring for their special someone. Most of them do not realize that it can take years paying off their credit.

8. Treating friends for a meal or a party.

College students love to eat out and party and sometimes a student may offer to pay the bills for her friends. Although this is a generous gesture, students should realize that they have a stable job to support them yet and that spending unnecessarily can hurt their credit badly.

9. Not keeping the credit card in a safe place.
Many students make the mistake of leaving their credit card inside their dormitories. Dorms often have open door policies so valuables can get stolen easily. Thus, students should be especially careful about where they keep their credit cards.
10. Lying about their charges.
Some students deliberately spend too much on their credit cards. Then, they call their credit card issuer and report that the card has been stolen. Obviously, this is illegal and must never be done.

Samantha Wilson is a consultant for credit cards for students. For years she has written student credit cards articles that would help build student credit.
Copyright 2009

Signing up for the first credit card for students offer

As you enter college, you might receive a lot of credit card offers from different credit card issuers.

If you’re not going to think about it carefully, you might just sign up for the first offer that you think sounds good enough for a credit card. It’s easy to get one enticed by a credit card offer. Most credit card companies make a lot of exciting promotions that may be hard to resist. However, if you’ll read the complete terms and conditions, you might be surprised to see that there are certain charges that are higher than expected.

To Sign or Not to Sign

To avoid signing up for the wrong credit card offer, don’t just read the best features of the credit card. Take the time to read the terms and conditions which can be found in the credit card’s website. This way, you’ll get to know about all the rates and charges that come with your credit card. Check out websites that give credit card reviews on different credit cards for students. These websites compile all possible student credit cards in the market, along with their main features in just one page. This will help you see what choices you have and compare them.

In addition, since this is your first time applying for a credit card, it will be better if you seek advice from your family or relatives who may know more about credit cards than you do. Better, you may seek assistance from a financial consultant who can give you an objective and informed opinion about the best student credit card.

Using up all your credit limit
Students are usually given a huge credit limit. But this does not mean that you can spend credit limit to the fullest. Bear in mind that you should keep your balances below 50% of your credit limit. Using up your entire credit limit on expenses has a negative impact on your credit report. Also, you’ll more likely have a hard time paying off your balances in time if you get in the habit of spending your credit limit to the maximum. This brings us to the next biggest mistake that students commit.

Not paying on time

The biggest mistake you can do on your student credit card is not paying your balances on time or skipping on your payments. Credit card companies can increase the rate of your APR, charge you with penalty fees and even take back your rewards and privileges. Worse, you might not be able to keep up with your credit. Incurred monthly balances are the most common cause why students get swamped with credit card debt.

Remember that owning a student credit card is your first step in establishing your credit history. You want to make a good credit report for yourself especially because an excellent credit status will be an enormous help for you when you finish college and enter the corporate world. So take your responsibilities on your student credit card seriously and avoid committing these mistakes.