7 Credit Card Tips for College Students

 If you are a young adult packing up the bag to head to college, now is the ideal time to manage money on your own. As the minimum age requirement for the credit card holder is 18 , so it’s preferable to start building a credit score at a very young age. Before you start building credit, you should essentially know the credit card tips for college students.

Without the proper guidelines, few adults develop bad money spending habits that can potentially harm them to a greater extent in the future. Although most students prioritize school work, and social life at this point of life managing finances side by side is also integral. But with so many competing priorities, its not easy to overlook the importance of credit until it’s too late.

Since after graduation expenses of students lash out including leasing an apartment, getting their first job, and financing a new car. Therefore, if you don’t have a credit history at this point, the lenders will refuse you to finance a car. To kick start a stable financial foundation, students need to pay heed to credit now. Without further ado, let’s jump straight to the Credit card tips for college students.

Important Credit card tips for college students – Key Takeaways

•  Signing up for a credit card may be a confusing option for college students but there are multiple benefits that go along with establishing a great credit card profile
•  If you are not careful and considering the viable solution to build credit, you might be caught in trouble
•  When you realize the need for building credit and start to pay your monthly bills on time along with following the other credit card tips for college students, then for sure you can set yourself a strong financial future.

7 Credit Card Tips for College Students

Each selected round-up seven credit card tips for college students are selected after careful consideration. These are the important tips for newbies to help you get started and navigate financial expenses in the best possible ways.

 1. Start learning about the credit early

Among all the important credit card tips for college students, this one is the first and most important step. Analyzing where your present credit stands and what your credit profile looks like matters the most. The three major credit bureaus which include Experian, Equifax, and TransUnion provide you a free credit report to analyze it fully before you opt for a credit card option.

Credit reports have the full data like your personal information and all the present details of the revolving and installment credit account you have, such as student loans. Moreover, you have to know in the start what affects your credit score such as making timely payments, student loans, and other cell phone insurance. The credit score usually ranges from 300-800 depending on your financial state.

2. Check around before you apply for the credit card

Credit card issuers are bound to list all the details including interest rates, annual fees, balance transfer fees, and transaction fees on their official website. Before you decide on what sort of card you want , you will utilize the information on the official websites and weigh the pros and cons and interest rates of the card. This is one of the most important credit card tips for college students to evaluate the interest rates and other charges before opting for a credit card option.

There are numerous student cards that come with no annual fees which is a good starting point for the first regular credit card. It is important to keep in mind that once you apply for the credit card, read all the terms and conditions carefully. The lender on the other hand does a hard inquiry on your credit card report. The hard inquiry can potentially lower your credit score by a few points. It is advisable to do hard inquiry on the cards that are worth it and that you can potentially buy in the bear future.

Best Student Credit Cards for 2024

The best student cards are listed with their benefits and drawbacks for students to establish their credits after careful consideration. These credit cards are specifically designed for students with lower credit limits to kick-start their financial journey. Among all the options Discover it ® Student Cashback is one of the viable options to earn a greater cashback along with a lengthy 0% APR period.

3. Know what card features to avoid as a newbie

As a college student, it is advisable to go for credit card options that charge no annual fee. As greater perks come with high annual fees, it is important to avoid the strain on the wallet as a beginner. One of the most important credit card tips for college students is that do not go for greater rewards at the start. At the start just focus on building the credit score.

When you place greater emphasis on building credit scores and go for rewards after creating a credit score of 700+. As you proceed further you can earn rewards by paying off the balance each month with a special spending cap set by the card issuer.

 Important Note: One of the greatest credit card tips for college students is that be aware of the notoriously high interest rate of cards if you have a balance to carry each month .

4. Pay your monthly bills on time

Its one of the crucial credit card tips for college students that plays a key role in determining the credit score. So it’s important to make your payments on time to maintain a good credit score. To make sure that you pay credit card balances on time , try to automate your monthly payments so that you won’t miss any payment.

It is good to set up autopay for certain monthly expenses and additional manual payments you can make each month manually. Most of the student credit cards charge a high penalty interest rate for missing out on payment. And rebuilding the credit score takes a longer duration of time than damaging it. It is advisable for students to pay in time in order to stay safe from the incurring interest charges.

5. Use very little of your credit limit

The monthly expenses should be lower than your total earnings each month so you can improve your credit score each month. The rule of thumb is that you should not spend more than 30% of your credit limit. The lower the credit card utilization rate the more beneficial it’s for you in the long run.

 For instance, if the current balance in your account is $3,000 and you have a limit of $5,0000, that means that the utilization rate is 60%

 ($3,000 / $5,000 = 0.6 X 100 = 60%)

Another important credit card tips for college students to tick the mark is to have a low utilization rate. Try to minimize our spending to a credit utilization rate of 30-40%. As with the passage of time credit card usage increases, you can ask the issuer to increase your limit as long as you don’t want to spend extravagantly.

 6. Keep an eye on the credit card charges

 To avoid being overcharged, it is important to instantly report the unauthorized card charges to the issuer. When it comes to fraud liability, a credit card is the most secure option in comparison with a debit card. Always go for the credit card issuer that offers 24-hour fraud protection and identity theft assistance in case of inconvenience. As per federal law, the most you could be liable for with a fraudulent credit card charge is $50 only.

It is an important tip among all the other credit card tips for college students who don’t blindly trust your card issuer. Instead, make it a habit to check your credit card bills. This way you can also minimize your spending and further motivate yourself to build greater credit.

7. Report the other bills to the credit bureaus

 It is pivotal to realize that if you make monthly on -time payments of utilities, cell phone and other charges through credit card , you could eventually boost the credit score. By leveraging the Express Boost™ users can easily connect to the bank account to identify payment history on certain bills. After verification of certain details, you can easily add payments to your Experian credit file and FICO® scores are delivered to you in the meantime. In brief , although last in the list but still its one of the important credit card tips for college students.

 Frequently Asked Questions