Yes, college students should have credit cards because it is the best way to begin building credit history. Simply owning a credit card account and keeping it in good standing can allow a student to go from having no credit at the start of college to fair credit or even good credit by graduation. As a result, responsible credit card use will give students a leg up when they enter the real world. Without a strong credit profile, students may have a difficult time renting an apartment, getting a car loan, finding cheap car insurance, and even landing a job.
Nearly 60% of all undergraduate students reported having a credit card in 2018, which amounts to a 90% increase from 2013. And 42% students consider the importance of credit cards to continue growing in the near future. It’s actually a myth that college students can’t get credit cards. To qualify, you have to be at least 18 years old and demonstrate the ability to afford monthly bill payments. More specifically, anyone between the ages of 18 and 21 must prove their ability to independently pay back debt before they can own a credit card, per the Credit CARD Act of 2009. Or, an applicant may have a co-signer who is at least 21 years old. The cosigner would be financially liable for the account. Most credit card companies don’t allow co-signers anymore, though.
At the very least, college students should have a credit card as an authorized user on a parent’s account. You can build credit as an authorized user while the primary cardholder is responsible for making payments. The primary cardholder can also monitor the account. If there’s any sign of reckless card use, they can remove the authorized user at any time.
Missing payments and racking up debt are the biggest reasons people say not to get a credit card as a college student. But there are easy ways to minimize the risk while still reaping all the benefits. For example, you’ll be less likely to miss any due dates if you set up automatic payments from a bank account. You could also pay any annual fee the card may have and then lock the card away somewhere safe – to resist the temptation to overspend. You’ll still build credit that way.
Finally, it’s worth noting that if you wait until after college to get a credit card, you could be costing yourself when it comes it annual fees and rewards. Credit cards for college students tend to be a lot more attractive than other credit cards for people with limited or no credit.
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