Must a Student Get a Credit Card?

Some people may frown at the idea of allowing young people or students to use their own credit cards. For others, having a credit card encourages overspending. In fact, many student cardholders have been stuck in bad credit as a result of uncontrolled credit card spending. Does this mean a student should not get a credit card?

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.


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