Students Should Carefully Consider Student Credit Cards

These credit cards are not always helpful to young borrowers

Students Should Carefully Consider Student Credit Cards
August 15, 2016

Many students see credit cards billed as "student" cards as a good way to build up credit during their education, but there are more factors to consider. While many of the major card issuers offer cards aimed at students, these often need a parent to apply. This is due to the Credit Card Act of 2009, requiring card applicants to have a full-time job or to be 21 years old.

This means it falls on the parents to help students open their first credit card account. Parents must remember that by making their child an authorized user on their card, or by co-signing a new card account, they will be responsible for the student's debt as if it were their own. If the student charges up a large amount of debt and is then unable to pay it, the parents will have to foot the bill.


Another option is for students to take out a secured credit card. They will have to put down a deposit to get the card, but this makes issuers more willing to take risks with those who have little or no credit. These cards often have fairly low limits to start with, so students are not able to charge up too much debt. If they show that they can manage the card responsibly, the issuer will be likely to increase their credit limit. The best way to do this, and to improve the cardholder's credit score, is by making on-time payments.

If you want more credit, check out MoneyTips' list of credit card offers.

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