Most students have limited experience with credit cards and other forms of credit. As a result, their credit history is generally weak or nonexistent. Therefore, the most crucial reason students apply for a credit card is to build a positive credit history.
Students interested in getting credit quickly should look for cards that report single payments to one or more (ideally all three) consumer credit bureaus and maintain the end of the contract by making full and on-time payments. The best student credit cards usually have low rates, reasonable April rates, and benefits specifically for students. Some even have reimbursement programs that reward spending on gas, food, meals, and other everyday purchases. Here are some of the best options on the market today.
A Deserve EDU Student Credit Card
Free ($59 Value)Year of Amazon Prime Student; Unlimited 1% Cash Back;
The Deserve EDU credit card is a free student credit card with an unlimited 1% refund on all eligible purchases. It comes with a year of free Amazon Prime membership.
Unlike most credit cards, the EDU subscription process was developed for first-time credit card users, including applicants who don't have FICO score or credit history - groups disproportionately represented in the student population. It takes non-credit factors into account when signing up, and verifying your bank account is very simple.
The Deserve EDU card offers several other benefits such as
Earn rewards: All eligible purchases receive an unlimited 1% refund. There is no limit to your earning potential.
Introductory APR: None.
Main fees: this card has no annual or external transaction fees.
Other Benefits: In addition to the free one-year subscription to Amazon Prime Student, this card offers many benefits, including a generous price protection policy, which reimburses the difference between the purchase price of certain covered items and any lower advertising prices on identical items. For sixty-days from the date of purchase (some restrictions may apply), cell phone protection up to $ 600 on request, and extended warranties of up to 12 months for eligible products purchased with the card.
Reimbursement of rewards: You can use any amount for bank statement credits, direct deposits to a linked bank account, and Amazon purchase credits. You can also redeem for gift cards, items, and other gift items, but the redemption values for these options may vary.
The Petal Cash Back Visa Card
Up to 1.5% Cash Back; Innovative Underwriting Procedures
The Petal CashBack Visa Card is not your usual student card, especially since it is not specially marketed for students. However, as it was developed in part for users with no significant credit history, it is possible to apply for this card without a credit score. It is ideal for students who are just starting to build up credit—petals reports for the top three consumer credit agencies.
Once you have established a timely repayment schedule, you can earn up to 1.5% in cash with your Visa Petal Cash Back card, avoiding the fees usually charged by other students' cards such as annual fees and external transaction fees. You can also get a refund of up to 10% on purchases from selected merchants.
The petal stands out for other reasons, including:
A non-customary underwriting process makes the card ideal for novice and non-FICO credit card users. Applicants without a FICO score are assessed on factors other than credit, such as income. However, the Petal card is not intended for committed credit applicants.
APR is lower than most other basic credit cards.
Credit limits range from $ 500 to $ 10,000. This is higher than normal for entry-level credit cards.
Without charge. The petal card does not charge annual fees or foreign transactions, for example.
The petal credit card is not perfect and may not be suitable for you. But if you're looking for a basic credit card that doesn't charge an annual fee, you can consider the non-credit factors and offer a refund for daily transactions, and it's worth taking a closer look. Again, a Petal card is not for people with bad credit or those who want to rebuild bad credit.
APR: the APR variable for regular purchases varies from 14.49% to 25.49%.
Earn rewards: the Petal card return program sets apart from many other basic credit cards. Cardholders are starting to receive an unlimited 1% refund on all eligible purchases. After six timely monthly payments, the reimbursement rate increases to 1.25% for all eligible purchases. After 12 timely monthly payments, the reimbursement rate increases to 1.5% for all eligible purchases, where it remains indefinitely. Purchases from merchants selected by Petal partners receive a refund of up to 10%.
Introductory APR: None.
Main fees: the Petal card does not charge any fees.
Registration bonus: there is currently no registration bonus. Check with petals for up-to-date information on time-limited promotions.
Reimbursement of rewards: Refunds do not expire as long as your account is open and updated. You can use any bank statement and paper check as soon as the return balance reaches $ 20 (the minimum size of the refund check is $ 20).
Other advantages: the Petal card participates in the local offer program Visa with Visa and Uber. With local Visa offers, earn Uber credits by spending thousands on participating local merchants, such as restaurants, independent retailers, and chain stores. Petal also offers certain additional benefits supported by Visa, including 24/7 roadside assistance and car rental insurance when paying full rental with the card. And the Petal mobile app makes it easy to track and manage your spending on your phone.
Citi Rewards + student card
Up to $6,000 Annual Combined Category Spending; 2X Points on Supermarket and Gas Station Purchases
The Citi Rewards + student card recompenses students who spend a lot on fuel and purchases, with points rounded to the nearest 10 for each purchase and the first 100,000 points redeemed each year with a 10% bonus as well as other types of expenses.
Providing school supplies is never easy, but incurring these expenses without interest eliminates part of the suffering.
Introductory APR: Purchase a 0% APR for seven months from the date of opening your account, after which the normal APR variable applies.
Main fees: there are no annual or foreign transaction fees.
Rewards and redemptions: Earn 2 X points on eligible purchases for stores and service stations, up to $ 6000 in combined category spending per year. All other eligible purchases earn 1X unlimited points, including purchases in supermarkets and service stations beyond the limits of the category. Citi approaches the closest 10 point increase for each purchase (for example, converting a 46 point purchase to a 50 point purchase) and increases returns by 10% to the first 100,000 points redeemed.
Sign-up bonus: when you spend a minimum of $500 on eligible card purchases within three months of opening your account, you earn 2,500 additional satisfaction points. Just redeem a $ 25 gift card.
Citi® Secured Mastercard®
Relatively High Credit Limit; Reasonable APR and Fees; Good for Students With Poor Credit
Citi Secured Mastercard is another protected credit card with benefits for students and at a minimal annual cost.
Before you become eligible for this card, you must deposit $ 200 or up to $ 2,500, subject to credit approval. This deposit is equal to your credit limit and cannot be credited to your purchases. If you display single payment schemes for 18 months, Citi can refund your deposit and allow you to continue using your card as a regular credit card.
Citi Secured Mastercard has relatively free credit approval standards. If you have poor or irregular credit, this is probably the best student card for you. And because Citi automatically communicates its payment models to the three main consumer credit reporting services, it's also an awesome card for building credit. If you make payments promptly, your credit score is likely to increase over time.
Introductory APR: there is no introductory APR.
Key Fees: there are no annual fees. External transactions cost 3%.
Registration bonus: there is no registration bonus.
Rewards and Redemptions: This card has no reward program.
Other advantages: the advantages of this card are similar to those of the Citi Rewards + Student card, including the Citi Private Pass.
Wells Fargo Cash Back College Card
3% Cashback on Gas, Grocery, and Drugstore Purchases for the First 6 Months; Then Unlimited 1% Cash Back
The Wells Fargo Cash Back Card is a student cashback card, possibly with the most valuable rewards program of all the cards on this list. Within six months of opening your account, you will receive a 3% refund on gasoline, supermarkets, and pharmacies, as well as a 1% refund on all other eligible purchases. At the end of the launch period, you will receive an unlimited 1% refund on all other eligible purchases.
This is not the only launch promotion for the Wells Fargo Cash Back College card; 12 months after opening the account, you will receive 0% APR on all eligible purchases, the longest APR launch discount 0% on this list.
APR introduction: acquisition of 0% APR for 12 months.
Key rates: there are no annual fees. Refer to Wells Fargo's terms and conditions for additional costs.
Registration bonus: there is no registration bonus.
Rewards and Redemptions: Receive a 3% cash refund on gas purchases, supermarkets, and pharmacies within the first six months when your account is opened. Receive an unlimited 1% refund on all other eligible purchases from the first day. You can exchange cash refunds for bank statement credits, bank account deposits, paper checks, and cashless items such as travel and entertainment, usually priced at $ 0.01 per point. Cash refunds must be made in steps of $ 25.
Other advantages: Wells Fargo bank customers benefit from special advantages for account holders. See the Wells Fargo website for more details.
Why it is Advisable to Build Credit as a Student
Credit creation may not seem like an urgent priority while you are still in school, but the sooner you start planning your credit history, the better. A good loan will be valuable in the future when you want to buy a house or get a car loan. For example, a good loan can increase your chances of getting a job or renting an apartment.
The credit history, detailed in the credit report and summary of credit scores, shows how you have managed your borrowed money, and responsible use of a credit card is one of the quickest and more comfortable to generate credit. Among the situations in which good credit is useful:
• Being employed: Depending on the profession, you may need a good credit score to pass the job evaluation. Some companies check credit, especially for jobs that require managing other people's money.
• Rent an apartment: When you submit an apartment rental request, the landlord can view your credit score to assess the likelihood that you will pay your rent on time.
• Starting a business: some lenders analyze your credit score when trying to establish a business loan.
• To borrow money: Whether you are applying for a credit card, car loan, personal loan, mortgage, or other loans, good credit history can be the difference between approval and rejection. Also, a good loan can benefit you from lower interest rates, which saves you money.
• Utility configuration: Service companies usually check their credit history. If you have insufficient debt or no credit history, your electric utility or water utility may ask you to pay a deposit or receive a letter of guarantee from someone who agrees to pay the bill if you can't.
Who Should Apply For a Student Credit Card?
The mere fact of being a student is not in itself, sufficient to be eligible for a student card. This is what you need to know.
Federal law restricts anyone who can get credit cards under the age of 21. Issuers are prohibited from providing cards to persons under the age of 21 unless they have proof of independent income or a co-signer. This person agrees to be liable for the debt if the primary cardholder does not pay the invoice. This can be a barrier, as most large credit card issuers do not allow co-signers.
Inappropriate credit is often the deciding factor. Student credit cards are created for people with little or no credit history. If your credit is insufficient due to late payments or some other fault, you are unlikely to get your student card alone. If so, look for a card specially designed for people with bad credit.
People over the age of 21 must also provide proof of income. However, they can list any income to which they have "reasonable expectations of access."
Student status may (or may not) be important. See the card's terms and conditions on the issuer's website for registration eligibility.
Conclusion
Credit card issuers know that, on average, students have less money than seniors with full-time jobs. As a result, they tend to strictly limit the amount that students can spend on their books. Do not expect your first student credit card to have an extremely high credit limit, especially if your only source of income is a scholarship or a job study.
The good thing is, if you make regular payments, create a positive credit history, and look for ways to earn extra income, your credit limit and purchasing power will increase over time. In a few years, thinking about your student time, you will be able to identify your first credit card approval as a flow in your financial journey. At the same time, a certain amount of consideration should be taken into how credit and the interests charged, can affect your taxes and what you might be able to claim as deductions, through the use of a credit card. To find out more about any tax filing implications due to your student credit card, contact DON BELL LAW.
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