Credit cards for students are especially designed with features and services to benefit this particular group so if you are student, you should take advantage of your privileges as a cardholder. However, using a credit card can also increase the risk of bad debt and this is why youngsters should watch out their spending.
On this post, we present smart tips on how you can use your student credit card to enjoy savings from your back-to-school purchases while avoiding bad debt:
Choose a low rate cash back card. If you are going to apply for a student credit card, consider a card with cash back rewards. Don’t forget to compares interest rates and choose the one with the most reasonable deal. Cash back reward cards are popular in the market because the program is simple and fits everyone’s lifestyle. You don’t need to drive a car or be a frequent traveller to get rewarded. Cash back cards give consumers the chance to earn cash incentives out of their spending so they are often ideal for students.
Read the fine print. Take the time to read the complete Terms and Conditions. See to it that you understand the rules of the reward program. How will you be able to earn points? What types of purchases are eligible? How many points can you earn per dollar spent? Generally, cash back cards offer 1 point for every dollar spent using the card. However, you might be able to find credit cards that offer double points to match your purchases.
Aside from the rules of earning points, you should also understand the rules on how to redeem points. What are the restrictions imposed by the issuer? Will your points expire after a certain time period? Will you be stop earning points after you collected a certain value of cash back in a month or in a year? The specific terms vary from one issuer to another so you want to make sure that your chosen student credit card complements your lifestyle.
Avoid interest rate fees. All reward cardholders must do everything to avoid the interest rate charges. The only way you can get rewarded is you do not pay these extra fees. Remember that reward credit cards usually carry higher interest rates than their non-reward counterparts. Thus, if you fail your full balance on time, you would end up spending more on interest rates. Such additional costs can offset the rewards you earn.
Buy from affiliates. Check out which shops and merchants are affiliated with your student credit card. You can surely earn bigger points per dollar spent when you purchase from sponsoring merchants. Most reward credit cards for students also offer exclusive back-to-school discounts but you need to be aware of the rules. If you are going to purchase online, you might be able to enjoy even bigger savings but you might need to enter a special code upon checkout to enjoy the discount.
Samantha Wilson is a consultant for credit cards for students. For years she has written student credit card reviews articles that would help build student credits.