How to Pick the Best Student Credit Card for You
The best credit card for college students is the
Journey® Student Rewards from Capital One® because it has a $0 annual fee, gives 1% cash back on all purchases, and encourages responsible behavior with a 0.25% bonus for paying your bill by the due date each month. The Capital One Journey Card also has a $0 foreign transaction. So it’s a great all-around offer, no matter where your studies take you.
But there are plenty of other contenders, some of which may turn out to be better for you than Capital One Journey, depending on your exact needs. For example, the best credit card for college students who want to travel is the
Bank of America® Travel Rewards Credit Card for Students, which offers an initial bonus of 25,000 points and much more. And the best student credit card for low interest rates is the
BankAmericard® Credit Card for Students, which gives
0% for 15 months on purchases and balance transfers, with a $0 annual fee and a $0 balance transfer fee.
But even though WalletHub’s editors have done the work to highlight the best student credit cards on the market, you still have to decide which offer is right for your particular needs. And these rules of thumb will help you pinpoint that plastic.
Here's how to find the best student credit card for your needs:
- Rule Out Cards with Annual Fees. Students should always limit their search to cards that don't charge annual fees. A student’s top priority for using a credit card is to build credit, after all, and most college students have limited budgets. So the best student credit cards are therefore those that are basically free to maintain.
- Focus on Rewards if You Plan to Pay in Full. Paying your bill in full every month is the best approach because it will save you from expensive interest charges and help you avoid getting into the bad habit of spending above your means. And since interest rates don’t matter when you pay in full, you can concentrate on getting the most lucrative rewards for your spending habits.
- Find a 0% Rate for Big-Ticket Purchases. There are a handful of 0% APR student credit cards available, any of which could save you a boatload if you plan things right. That means applying a few weeks before your desired purchase date and repaying your balance before regular rates take effect. WalletHub’s Credit Card Payoff Calculator can help with that.
- Transfer a Balance If You’re in Credit Card Debt. A few student credit cards offer 0% intro rates on balance transfers. With that being said, you’ll need to consider more than just the length of the 0% term, including each card’s balance-transfer fee and regular APR. You can crunch the numbers with WalletHub’s Balance Transfer Calculator to see which offer would save you the most money.
- Get a Secured Card If You’re Rejected. Secured cards are the easiest type of credit card to get approved for. The reason is this: They require a refundable security deposit that serves as the account’s spending limit and reduces risk from both the student’s and issuer’s perspective. They also are indistinguishable from unsecured credit cards on your credit reports, which means you can build credit and practice responsible habits without running the risk of exacerbating your situation. So, if you have damaged credit, opening a secured card and rebuilding your credit standing is a must.
Before deciding on a credit card, you may want to take another look at the best offers with these tips in mind. For your convenience, we'll recap WalletHub's picks below.
Here are the best credit cards for college students:
Money-Saving Tips For College Students
Identifying the best student credit card is only half the battle. You also need to use it responsibly, avoid common money-management mistakes, and build financial literacy for success after graduation.
- Consider Credit Building Your Top Priority – A good credit score will save you thousands of dollars per year on loans, lines of credit and insurance premiums. It may even help you land your dream job or lease a new car. And two of the keys to building a good credit score are making on-time payments and establishing a long track record of responsible borrowing.
- Don’t Make Purchases If You Don’t Trust Yourself – Credit cards report information to the major credit bureaus every month even when you don’t make any purchases. And while you may build credit faster by making purchases and paying them off by the end of the month, overspending and missing payments is counterproductive.
So if you don’t trust yourself to spend responsibly with plastic, give your card to your parents for safekeeping. You could even cut it up. Just make sure to save your account number in case you need to call customer service.
- Make a Budget – If you combine credit card use with a well-defined budget while in college, you’ll be well ahead of the curve. Only two in five consumers have a budget, according to the National Foundation for Credit Counseling, and that’s one of the main reasons why credit card debt levels are so high.
To learn how to take this important step, check out WalletHub’s step-by-step guide on how to make a great budget.
- Take Advantage of Campus Resources – Most colleges and universities offer financial literacy resources of some sort. For example, there might be a personal finance class you can take, a money-management help center you can visit or online educational materials to peruse. Find out and soak up as much information as you can, especially if it will fulfill a curriculum requirement. Because unlike much of what you’ll learn in college, financial skills translate directly to everyday life.
- Approach Student Loans with Caution – Taking out a bunch of student loans might not seem like a big deal now, considering how long you’ll have to pay them off. But too few students truly consider how big of a burden they can wind up being. Student debt increases the pressure to find a job and can delay major life events such as buying a home, getting married or starting a family.
No one wants to be paying off education debt into their 40s, which is all too common these days. So try to supplement your tuition money with scholarships, grants and work experience. This will also give your resume a boost.
- Improve Your Financial Literacy – Understanding how to manage money is an invaluable life skill. And you probably won’t learn much about in school. So you’ll have to take things into your own hands. To get a sense of your current knowledge level and the areas where you can improve the most, get your WalletLiteracy Score.
2018 Student Money Survey
Attending college is a big achievement and an exciting time in one’s life. It can also be scary, especially when you consider that most students aren't taught much about personal finance.
In order to learn more about college students’ preparedness and plans for increased financial independence, WalletHub conducted a nationally representative survey. We asked about everything from who students' financial role models are to whether credit card debt or student loan debt scares them more. You can find the complete results in the infographic below.
Ask the Experts: Best Credit Cards for College Students
Since student credit cards are the subject, we’re taking you back to school for some extra-credit advice on the best ways for college students to use plastic and the biggest mistakes to avoid. We posed the following questions to a panel of experts, and you can check out their bios and responses below.
- What attributes would you say the best student credit cards share?
- What is the best way for a college student to use a credit card?
- What is the biggest mistake that college students make with credit cards?
- What is your best piece of advice for a college student who is considering applying for a credit card?
- Should credit cards be easier or harder for college students to get (or is it just right)?
Haley Kline
Kwamie Dunbar
Guan Jun Wang
Ariel Belasen
Matthew Ross
Thomas A. Hanson
