Best Credit Cards
Balance Transfer Cards
Reward Credit Cards
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Cashback Credit Cards
Low Interest Cards
0% Purchase Cards
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Student Credit Cards
Gold Credit Cards
Platinum Credit Cards
Debit Cards
Corporate Credit Cards
Small Business CardsSummary:Student credit cards can become the boon or bane of a student's financial life. Students have so much to learn – in and out of the classroom. Education can prepare you for a wonderful career, and wise use of a credit card can set you on course for a healthy and happy financial life.
Hocking Your Future
So many young adults walk off their campuses after being graduated and walk into a new and exciting world – filled with loads of credit card debt and unpaid student loans. Entering life's mainstream encumbered by debt is not a very auspicious beginning.
Featured Student Credit Card
If this your first time applying for a credit card then Commonwealth Bank Low Fee Credit Card is a great choice you should consider. It features a $0 annual fee plus balance transfer offer. Build your credit rating with this card while you are a student.
- 1% p.a. for 5 months (reverts to 20.24%p.a.) on purchases
- 5.99% p.a. for 5 months on balance transfers
- $0 Annual Fee for the first year ($24 thereafter) annual fee
- 21.74% p.a. on cash advances
| Interest Rate (p.a.) | Balance Transfer Rate (p.a.) | Annual Fee | Cash Advance Rate (p.a.) | |||
|---|---|---|---|---|---|---|
 ANZ First Visa Credit Card | Enjoy a low annual fee and security with ANZ First Visa Credit Card. | 19.39% | 2.9% for 12 months | $30 | 20.99% |   |
 Commonwealth Bank Low Fee Credit Card | The Commonwealth Bank Low Fee Credit Card is a great card is you always pay off your debt before it is due. | 1% for 5 months (reverts to 20.24%) | 5.99% for 5 months | $0 Annual Fee for the first year ($24 thereafter) | 21.74% | |
No Bed of Roses
Sure, student life is no bed of roses – ramen noodles get old after awhile and pants so old they shine can be an embarrassment. But hocking your future to forego a few hardships in the present is not a good financial move. And it's not a good way to look at credit, student or not. Yet many do.
A Credit Card Is Not a Source of Income
The biggest problem with credit cards, especially with first-time users, is that they are so easy to use. And it's so easy to forget the consequences of their use. They seem to be free money. They become a crutch in weak-willed or undisciplined hands.
Don't Count on Credit for These
Credit cards are basically for emergencies only or financial backup under extreme circumstances. Scholarships, grants, and student loans, not credit cards, are best to cover these requirements of higher education:
- Tuition. Taking a full course of classes each semester is extremely expensive. Charging the tuition of a full-time student on a credit card would have even working professionals overwhelmed with debt in no time.
- Room and Board. Your biggest cash outlay after tuition will by incurred by eating and sleeping. Whether on campus or off, it costs money to put a roof over your head and to eat. Utility fees can come into play as well. Will you require an internet connection? You just don't put rent or groceries on a credit card unless you have the funds to pay immediately.
You Can Fudge Credit on These
The greater part, if not all, of the cost of these following requirements should be built into student financial assists such as grants and loans. But if the need is extreme and there's just no other money available at the time, part of these expenses could be charged:
- Books and Materials. After tuition, the most expensive educational cost will be texts and educational tools and materials, such as a laptop.
- Sundry Fees. Whether it be lab fees, student union fees, association memberships, or sundry other nickel and dime expenses, they add up quickly.
- Transportation. Bus fare, train fare, or gas, maintenance, and insurance on a car, or plane fare home for holidays or summer break, all should be figured when considering the mobility you'll need as a student.
Never Use Credit for These
Life is full of temptation, especially for the young. It takes a strong person to keep from misbehaving when there's plastic in the pocket.
- Night in the Town. Even the most sober working professional knows that one great night out can ruin an entertainment budget for a couple of months. And when a youngster gets a few under his or her belt, buying a round for buddies is really easy and seems like a great thing to do.
- Eating Out. Scrambled egg sandwiches. Ten dollars at a fast food joint once a week will cost you four extra dollars when the billing cycle rolls around. If you only pay the minimum when the card comes due, that burger and fries can end up costing $20, or even more. Twenty dollars can buy a lot of groceries.
- Holidays. Spring break and other school holidays are etched as a part of the fun of college or university life. Charging $500 to a $1000 on a three-day weekend will afford you a lot more than a hangover. You'll be paying that debt when your colleagues at your first job are heading for a lot better vacation than a spring break. You won't be able to afford one, due to your youthful fling.
- Cash Advances. These will be charged at an interest rate of 20% at the get-go and usually incur an administrative fee as well. Twenty dollars cash advance will cost you $24 plus an admin fee if you pay on the next billing cycle. If you don't pay in full, it just gets worse fast.
Are You Smart Enough to Have a Credit Card?
Now that you've read about some of the pitfalls, do you think you can handle the use of a credit card? If so, here are some guides to help you decide what type of credit card would best suit you as a student:
- Student Credit Card. Most financial institutions offer credit card products designed specifically for the use of students. These products feature or combine many of the specifications below. They do require proof of enrolment and often require the signature of a parent, guardian, or other responsible, professionally employed individual.
- Low-Interest. You probably won't have the benefit of high-paying employment and you probably won't be able to completely pay off your card at each billing cycle (though you should try). So, it is very important that you find a card with the lowest interest rate possible. Some even offer introductory no-interest periods, usually for six months. Do some diligent shopping around.
- No or low fee. Most credit cards demand some sort of annual carrying fee. These are usually very low on student credit cards. Some have none for the first year, or none altogether. Again, another reason to shop around.
- Avoid Reward, Cash-Back, or Prestige Cards. Cards offering rewards or cash backs carry higher interest rates and one would have to spend $2,000 or more a month to realize any benefit. Prestige cards carry high annual fees – wait until you're a CEO before getting that platinum card.
Alternative Cards
If you don't feel that a student credit card would be a beneficial financial tool for you, alternatives are available. These cards will offer you pretty much the same convenience and protection of a credit card without the potential for financial difficulties.
- Debit Cards. These cards are partnered with a banking account, usually chequeing, sometimes savings. Expenditures cannot exceed the amount in the account. They are subject to overdraft fees should you forget a charge that hasn't yet gone through. Overdraft protection is sometimes available. These can incur fees at ATM's.
- Prepaid Debit Cards. These are next to cash with the convenience of a card. The card is loaded with a set amount of cash and once it's exhausted the card can be trashed or reloaded. They are accepted where credit cards are taken. There's no room for abuse. These are subject to ATM fees as well.
