Things to Consider Before Applying for a Student Credit Card
Your very first credit card can be an effective tool in paving the way for a bright financial future. This is because your first card can help you build your credit reputation. And as long as you are able to maintain a good credit standing, for sure you can end up receiving excellent credit prospects, land great job opportunities, and even find decent financing options to buy the car and the house of your dreams.
However, a student credit card can also pave the way for financial trouble. If you use your card irresponsibly, you can suddenly find yourself sinking deeper and deeper into credit card debts. Not only will these credit obligations prove very difficult to pay off. They can also inflict long-term damage on your credit history.
Yes, your first credit card can be a double-edged sword. It can work to your advantage or it can cause you financial disaster. So, you have to be very careful in choosing as well as in applying for a student credit card. This way, you can select a card that will suit your needs as well as your financial capabilities as a college student.
Now what do you need to consider when shopping for an excellent credit card program? The answer to this query will be discussed in the remainder of this article.
Thing to Consider Before Getting Student Credit Cards
1. The Rate of Interest.It is important that you think about the rate of interest that will be charged on your student credit card. This is because the interest rate will determine how much cash you need to shell out on interest in case you are not able to pay your credit balance in full each month. It is also important that you consider the following questions:
– Is the rate of interest suitable to my current financial standing?
– Is the rate within the acceptable range of interest rates offered by most lenders and credit organizations?
– Is the interest rate fixed and permanent or is it only a part of a short-term teaser program?
The answers to these questions will help guide you in deciding whether or not to take the credit cards for student program being offered to you.
2. Fees and Charges.You also need to know the schedule of fees and charges that you need to pay as you charge your purchases and bills on your first credit card. Remember that aside from incurring some initial costs to get your card, you may also need to pay finance charges, late payment penalties, and annual fees while you are using your credit card. So while shopping for a student credit card, resolve to take out only the program that asks for very few and affordable fees and charges.
3. Features offered in the card.Aside from the rate of interest as well as the fees and other charges, you also need to consider the other features that student credit card offers. Does the card offer a cash advance facility? Can you earn and redeem rewards when you regularly use your card in making purchases and in paying your monthly bills? Does the card offer insurance? Knowing the answers to these questions will help you see if you can maximize the benefits you can get from using your credit cards for student program.
4. License/Accreditation of the Card Company.You also need to consider the credibility as well as the track record of different card issuers. Perform thorough investigation on their licenses and accreditation from the federal and state government. You may also want to read reviews and testimonials from both satisfied and dissatisfied consumers of the company as these will show you how the organization deals with its clients. By doing these activities, you can have ample information that can guide you to legitimate and reputable credit card companies.
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