Before, students can’t just open a credit account without a cosigner. Credit card companies do not extend credit to students because they’re considered as high risk. Yet today, credit card issuers have opened their doors to the student market. To keep up with competitors, most credit card companies today offer credit cards that are especially designed for students.
How to Build Your Student Credit Rating
One of the advantages of having a student credit card is being able to establish an early credit history. Even while in college, you can start building your credit in preparation for the future. Applying for a student credit card is easy and most do not even require a cosigner at all. In fact, this would be the only time you can get approved for a credit card without a credit history or a job.
After graduation, you’ll find that credit card companies have more strict standards especially if you want to enjoy the best deals. This is why young people are encouraged to obtain a student credit card. But how can a credit card help you build up your credit history? As long as you use your card to keep your account active and as long as you keep up with your payments, you are building credit history for yourself one step at a time.
What about the risk of overspending and credit card debt? Problems can be avoided by paying attention on your credit card use. Below are practical tips for students on how they can make the most of their student credit card:
Take your payment responsibilities seriously. Every credit card holder must realize the importance of timely payment. Skipping or delaying with your payments puts you at risk of bad debt and also puts your credit history in danger.
Protect yourself from credit card fraud and ID theft. Take care of your credit card and your credit card information. If your card gets lost or stolen, call your credit card issuer and freeze your account right away.
Check your bills. Make sure that there are no unauthorized charges in your monthly statements. Make it a habit to examine your credit card statements so you can dispute incorrect charges immediately. Don’t apply for too many credit cards. Having just one student credit card should be enough. Having too many cards in your wallet may tempt you to spend more.
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