How to choose a student credit card

One of the most accessible paths to building credit is a student credit card. Cultivating consistent, positive credit-building habits with a card that fits your needs will set you on the right track. As with any credit card, there are many factors to consider to help you choose the right one.

A student credit card works similarly to most standard credit cards. What sets student cards apart is their focus on student-related perks and benefits. For starters, this often means the credit requirements for approval are more relaxed to account for a student’s lack of credit history.

If you’re trying to decide how to choose the best student credit card for you, just follow these steps to get started:

Make sure you meet the eligibility requirements for student credit cards

The minimum credit card age requirement is 18 years old. However, there is an extra requirement for anyone applying for a credit card under 21, thanks to the Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009. The CARD Act requires credit card applicants between 18 and 20 to show proof of independent income. If you don’t have independent income, you can still access credit before 21 by becoming an authorized user on someone else’s card.

Applying for credit after the age of 21 releases you from some of the more strict parameters of the CARD Act, but you’ll still be required to note a few important pieces of information on your credit card application. Be ready to provide your birth date, income, credit history and Social Security number (SSN).

Analyze your spending habits

A student who spends a lot on dining out or entertainment may find their match in a student card that richly rewards these kinds of purchases. An adventurous student may want to pick a card that offers generous cash back rewards on gas or airfare. And for the practical student, cash back on groceries could be very lucrative. Understanding where your dollars often land will help you decide on a card that rewards these kinds of purchases handsomely, giving you the most bang for your buck.

Not sure what your spending habits are? Take the time to break down your finances up to this point and see where most of your money is going every month. A spreadsheet or a budgeting app can help you do this more easily. Then, check out our Credit Card Spender Type Tool to see what kind of spender profile best suits you. Once you’ve chosen a profile, you can get personalized credit card recommendations based on your spending habits and daily needs.

Consider whether you’ll study abroad or travel often

Because of the extra processing expenses, many credit cards charge fees on purchases made outside of the U.S. — usually around 3 to 5 percent of each transaction. Luckily, some cards charge no foreign transaction fees. This feature is ideal for students who plan to study abroad and want a payment method aside from carrying loose cash. Using a credit card is a safe and secure way to make purchases overseas, and picking a card that doesn’t charge foreign transaction fees can save you money in the long run.

You’ll also want to think about how widely accepted your credit card will be while abroad. Some credit card issuers use networks like Visa that are internationally available nearly anywhere, while others might use a network like Discover that has a slightly more limited range of use.

Think about the effort you’re willing to put into keeping up with your credit card

Student life is busy, and you may not always have the time to put extra effort into crafting a credit card strategy. When choosing a card, decide how much time you’ll be willing to spend on keeping up with your credit card outside of the required monthly payments. Do you want a low-hassle card that has a standard rewards rate on every purchase you make? Do you want to put in work to maximize rewards by tracking quarterly enrollment in bonus categories? Both options can be worthwhile, but you’ll need to decide which one is most feasible for your lifestyle.

Narrow down your choices by comparing cards

Choosing the best student credit card comes down to understanding your spending habits and figuring out the best way to use your card to meet your needs. Factors to compare in student credit cards include:

• Annual percentage rates (APRs): There are a few types of APRs when it comes to credit cards, but the main one that gets advertised is typically the purchase APR. This refers to the interest rate you’ll have to pay yearly for carrying a balance from purchases on your credit card. The lower the APR, the better. Otherwise, you could find yourself paying a ton of money in interest fees if you have to carry a balance month to month.
• Fees: These can include late fees, foreign transaction fees or other penalty fees. Some cards will waive the late fee for the first missed payment, while others will charge you right away, so it’s important to be aware of not only the fee amount, but also the rules regarding them.
• Rewards rates: Now that you know your spending habits, you can compare cards that offer rewards in certain spending categories. You can also figure out whether a rotating category card or a flat-rate rewards card might be better for your needs.
• Additional perks: Most student credit cards are pretty lean on extra perks, but they’re still worth looking into. Most cards offer welcome bonuses, and some offer other benefits like complimentary Uber One memberships, 0 percent introductory APR offers and more.

Find out which cards you qualify for

When comparing student credit cards, you’ll want to stick to cards with approval requirements that fall within your credit score range or don’t require a credit history to apply. For example, the Capital One Quicksilver Student Cash Rewards Credit Card requires a fair to good credit score to qualify (or a FICO score between at least 580 and 740).

If you don’t yet know your credit score, there are a few ways to check your credit score for free, including using the American Express® MyCredit Guide program (which is free to anyone, regardless of if you own an American Express card).

Once you’ve figured out your credit score and have narrowed down your card choices, you can things a step further and see whether you’re prequalified or preapproved for the cards you want. The prequalification and preapproval process includes a soft pull on your credit report, which won’t impact your credit score. By looking at your report and other factors, an issuer can let you know whether you’re likely to be approved for the card you’re looking at.

You can check to see whether you’re preapproved by going directly to the issuer’s site or by using Bankrate’s CardMatch tool. Once you know your approval odds, you can make an informed decision about which card to apply to.

Check out alternatives to student credit cards before you apply for one

If it’s not the right time for a student credit card, there are other ways to access credit that have similar benefits to student credit cards. Instead of signing up for a student card, you can:

• Become an authorized user: If you’re under the age of 18 or don’t feel ready to take on the full responsibility of being a primary cardholder on a credit card, you could become an authorized user on someone else’s credit account (usually a parent or guardian). Given you and the primary cardholder both use the card responsibly, you’ll build credit and start to create healthy financial habits.
• Sign up for a secured credit card: Another common starting point for people looking to build credit from the ground up is a secured credit card. These cards require applicants to put down a refundable security deposit, which serves as collateral for a card issuer just in case you’re unable to pay your bill.
• Look into credit cards for no credit history: Also known as starter cards, these credit cards are built for those with little or no credit history, a category many students fall into. The credit requirements for approval are low, and some are even geared toward students.

The bottom line

Getting a credit card is a big step in your financial journey. As a student, choosing the right card is a solid way to get started on the right foot with your credit. Do thorough research on the best student cards on the market and pick one that will best fit your lifestyle and reward you most for your spending.

Make sure you have all the necessary materials for a successful application, and always pay your bill on time once you’re approved. You’ll be on your way to an upgrade and a great credit score in no time.