Posts Tagged ‘Cards’

Understanding College Credit Cards

accounting colleges | Posted by
Sep 07 2010

Today credit cards are everywhere you look and even college students are great candidates for owning their own college credit cards. Many students are now living on their own or in dorms and need to learn to maintain their own expenses making college credit cards a necessity for many students.

College credit cards are basically just like regular credit cards. However, since college students do not have any type of credit history, they are usually unable to apply for and receive a regular credit card.

However, the question remains, why would a credit card company be willing to give college students credit cards if they have no way of paying back the money they charge on their college credit card?

Well, there are two very good reasons. Most credit card companies that offer college credit cards see a large opportunity in college student population. In fact, the majority of college students stay loyal to their credit card company even after they graduate from college.

It has also been reported that many college students will, in fact, pay on time and give the companies workable income. With the proper use of credit cards, college students can ensure they have good credit when the time comes for them to purchase a new car or new home.

College credit cards are usually preferred by most parents. They know their children may have the chance to overspend but they also know that with their own college credit card they will be building a stable financial future and receive other benefits that regular credit cards do not offer.

College students can use their cards to pay tuition fees. Some college credit cards even offer many unique benefits such as rewards if they pay their balances in a timely manner.

Most college credit cards also offer students lower interest rates as long as the college student maintains good grades. The use of credit can teach the importance of how to create and live on a budget and is great for parents that cannot afford to finance or manage all of their college student’s spending.

College student credit cards can also be set up by parents as pre-paid accounts; this way if the college student needs a little extra money, parents can always add to the credit card but ensure they use the credit card wisely and do not overspend.

The ultimate goal with college credit cards should be for students to learn how to use credit cards responsibly and to learn what they charge on their card is their responsibility.

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Are College Credit Cards For You?

accounting colleges | Posted by
Sep 04 2010

College credit cards are the credit cards that have been specially designed for college students. College credit cards are more popularly known as student credit cards. College credit cards allow the students to experience the benefits of credit cards much earlier in their life.


Through college credit cards, the college students are able to learn more about credit cards and their use. In fact, for most of the students, their college credit card is their first credit card that acts as a gateway to the world of credit cards.


Some other students might have previously used supplementary credit cards linked to their father’s credit card account; however, for such students too, their college credit card is the first one that is truly theirs.


College credit cards are not very different from other types of credit cards in the basic sense; they function in the same way as any credit card would. However, there are some differences, which basically arise from the fact that college credit cards are used by people who have no prior experience with credit cards and who perhaps don’t understand the concept of credit cards completely.


Hence, the credit card supplier is at risk with issuing credit cards (college credit cards) to such people whom he is not sure about. Most of the students don’t have a credit history either. In such a case, the supplier of college credit card cannot be sure of receiving the credit card bill payments in time (and even receiving them at all).


To counter such risks, the supplier of college credit card requires the parent of the student to co-sign the college credit card application form as a guarantee. Moreover, the credit limit on college credit cards is generally around $500-$1000 per month, which is lower than what it is for other credit cards (this credit limit is generally sufficient to fulfil the typical needs of a student).


Another risk mitigation instrument used by the college credit card suppliers is the interest rate or APR. The APR on college credit cards is generally higher than that for other credit cards. Again, this is done to dissuade the students from overspending on their college credit card (and finally not being able to pay their credit card bills).


However, if we were to look at these impositions in a positive sense, we would find that these are actually in favour of the student (who is still getting trained to take on the real world of credit cards). Moreover, college credit cards also help the students in establishing a (good) credit history which is another important benefit that becomes handy when the student needs any type of loan at a later stage in his/her life. So, college credit cards are really something that every student should consider going for.

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Lowdown on Credit Cards for College Students

accounting colleges | Posted by
Aug 20 2010

Are you a student pursuing a certain course in college? How do you pay for your college expenses? Surely you might be buying gifts for your loved ones or gifting your friends on their birthdays or other occasions. Also one needs to buy other commodities like T-shirts, books, and shoes from stores. Student credit cards can prove to be a boon for high school as well as college going students. There are many good reasons to have a credit card for college students simply for the benefits that they offer.


Benefits of Credit Cards for College Students


Credit cards do away with carrying a lot of money in your wallet, give insurance against purchases, allow you to shop online, and they also prove to be a sort of cushion in case of any emergencies. There are a few companies offering credit cards specially custom-made for college students. Most of the companies have their kiosks and stalls at college campuses advertising their products and providing card details to the students.


Credit cards help build a credit history for students. After graduation, a good credit history can help finance expenses for buying a new apartment or a new car. This is because companies often look at the summary of the credit report before allotting loans for a house or a car. Hence a good credit history can make availing a loan relatively easier. One should have a clean credit report in order to get the loans sanctioned. If the credit report contains a lot of unpaid bill summaries then it becomes difficult to avail a good loan and other associated benefits.


Disadvantages of a Student Credit Card


However credit cards also have their disadvantages. They carry high finance charges for unpaid bills at the end of the month. These finance charges can be as high as 20%. Also, there are yearly membership fees which range anywhere between $25 and $100. In addition, not paying expenses on time can lead to very high interest rates.


Hence it is better to buy a credit card for college students only if one has the capability to pay all the finance charges and the bill amount on time. Not paying finance charges and the unpaid bill amounts on time can lead to suspension of services and the student can get a bad credit report.


Tips for Selecting Student Credit Cards


You need to be aware of some basic rules for buying a college student credit card.
-First, read all the conditions carefully before signing on the dotted line.
-Get answers about how much interest rate the card carries as well as the interest rate for cash advances.
-Study the penalties or interest rates to be paid if the bills are not paid on time.
-It is also better to use a debit card instead of a credit card. This is because with a debit card, the amount is deducted from the account where funds are already deposited from the beginning. Hence subscribing to a debit card ensures that you can’t spend more than the money you have in your account.
-You should use a credit card only if you are certain that you will be able to pay the debts on time. As far as possible, cash should be used for buying items. One should use a credit card only for emergency purchases.
-It is better to get only one card from a company after comparing the services provided by all companies. Do not get two or three credits cards from different companies as it leads to a lot of hassles like remembering the due dates for paying bills, extravagant expenses, etc.


Hence, as mentioned before, students should buy credit cards only if they have the capacity to pay all bills on time and also exercise control on their spending habits. Student credit cards help teach teens how to handle credit. Also, credit cards for college students allow them to build a good credit history if a student credit card is used in moderation.

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College Credit Cards – Building a Good Credit History at An Early Age

accounting colleges | Posted by
Aug 06 2010

College student credit cards are intended specifically for students who normally would not qualify for regular credit cards, as they do not have a steady income or a credit history. As a student, it is a good idea to establish a first-rate sound credit history at an early age, which would help you get a regular credit card in the future, regardless of your employment status.


College Credit Cards Versus Generic Credit Cards


In theory, college credit cards are identical to regular credit cards. However, a college credit card is meant for college students who do not have previous credit history. Hence, these cards have more restrictions or conditions than the generic cards. The top three restrictions include:


- Co-signature from the parent or guardian at the time of application

- Lower credit limit (Example: $500 to $1000)

- Higher interest rates than traditional credit cards: Normal interest rates on these cards are 16-18%


Advantages of a College Credit Card


A college credit card has become a necessity for most students. The advantages are many provided you understand how the credit card works and use it with caution. Students, especially in United States, are prolific users of these college credit cards. This is primarily because it gives them great flexibility to manage their credit.


Students can use college student credit cards to pay their tuition fees, to rent a car, or to fill gas.

In fact, there are certain college credit cards that offer low interest rates to students who maintain good grades. These cards are also packed with rewards and benefits. These cards help students to learn and manage their finance at a young age.


A college credit card can also be a pre-paid one, with a ceiling on the credit limit. This ensures that the student does not overspend and it also helps parents keep an eye on their children’s spending behavior.


Characteristic Features of College Student Credit Cards:


There are many college credit card options from Citi, Discover, and Chase. Apart from these, there are many pre-paid card options. Most of these student cards have many of similar features including:


- 0% APR for the initial period of usually 6 months on both purchases and balance transfers (typically)

- No annual fee, at least for the first year

- Online account management at no extra cost


While many of the above characteristics are also applicable to many traditional more generic credit cards, there are certain distinctive features that make the college student credit card stand apart including:


- 0% liability for any unauthorized charges on the account

- A good GPA helps earns points for the cards

- Theft and fraud alerts


It is a good thought for students to have their own college student credit card. However, it is important to understand that, at an early age, bad credit could have horrible consequences. Parents can assist their kids in choosing the best college credit card based on their child’s spending behavior and repaying capability. College credit cards promise financial freedom at a young age if they are used judiciously.

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