If you are a student, either already at college or heading off soon, getting a credit card could not only help you tremendously financially, but help build a credit history that will stay with you for the rest of your life. If you have never received a credit card, or even applied for one, you may have to do a little digging before finding a credit card company that will issue you a card. Don’t be alarmed though, everyone has to go through this process, as everyone needs to establish some trust with the company before they hand you a plastic card that could cause some serious financial damage to an unprepared and experienced individual.
While shopping for a credit card, begin by searching through those designed for students in mind. Applying for a regular credit card is most likely not your best option at this point of time. Student credit cards will most often require a limited (if any) reported income and usually no co-signer, although you may want one to get a better interest rate. By using a specially designed credit card you can build credit the smart way. As mentioned earlier, no income is generally needed to be accepted for a student credit card. If you are not currently generating any income, your credit limit will most likely be small, but upon keeping up with your payments and using the card responsibly, they will allow for an increase in this limit.
Credit card companies realize that students 18 and over are new to the market for credit cards. They will most likely compete for your selection of a credit card by using low interest rates, less annual fees, and discounts or rewards. It is in your best interest to ‘shop’ these companies to compare the rates and offerings of each. Get the most out of your selection and use it wisely!
Building your credit is a process that you must take seriously. It is a general rule of thumb that no matter what you are doing, it is always easier to destroy something than to build it, and this rule is no different relating to your credit. Making monthly payments that at least cover your minimum payment and not maxing your credit card limit are vital to keeping your score in good standing. It would be ideal for you to pay off your balance at the end of each month, but you won’t be shunned for carrying a small balance. Building credit is not an overnight process, but after at least six months you may be able to apply for other types of credit cards or receive even lower interest rates from your credit card company.
Building credit is an absolute must when you plan to purchase a car, house, or even rent an apartment in the near future. Starting the process early will ensure you have ample time to build this credit and reap the benefits later in life.