Options Besides Student Credit Cards
If you are not yet prepared to open a student credit card account or if your application is declined, there are alternative solutions that could offer you financial freedom and similar benefits.Protected Credit Agreement
An alternative that some people may feel more comfortable with is a secured credit card. Secured credit cards work in the same way as unsecured ones, but instead of getting a credit limit, you have to put down a deposit. Because the security deposit safeguards the lender against any unpaid balance, secured credit card approval is less difficult. Responsible cardholders may be able to get their initial deposit returned when they upgrade their secured card to a non-secured one.
Payment Method
You can lower your financial burden with a charge card and still have the convenience of a credit card. A charge card is similar to a credit card, except that you have to pay for the entire balance every month. Since you can't keep a balance on the card, interest will never accrue. Potentially useful for first-time cardholders in getting a feel for how much they can afford to spend.
Gift Voucher
Gift cards linked with popular stores may also be a good spending priority for some students. Gift cards can be a great way for students to avoid spending all their funds or carrying around large amounts of cash. They are perfect for graduation, birthdays, or even just treating yourself. Students can take advantage of sales and discounts offered by several major corporations, such as Amazon and Apple. You might be eligible for even deeper discounts if you can provide evidence of your student status.
After Graduation, What Happens to Credit Cards Issued by Students?
If your student credit card was your first, you probably shouldn't close it when you graduate because the age of your oldest open account influences your credit score. You probably won't need to fret over this too much because many issuers let students "graduate" their accounts to non-student versions without erasing their payment histories. Your account will probably not be closed when you graduate, no matter how the issuer categorizes it. The card should keep working normally.
Maintaining the account open won't prevent you from wanting a replacement card. The greatest credit cards for new grads can have more and superior benefits, as well as more chances to earn rewards quickly. Be careful to monitor the account if you decide to keep it open but not use it. You can accomplish this by routinely reviewing your account statements for any signs of fraudulent activity, such as fees.
The Verdict
You can get financial independence and establish credit in other ways besides using a student credit card, although it's usually easier to get one. Credit cards are a powerful tool when used carefully, thanks to their rewards programs, welcome bonuses, and purchase protections.
Credit Card Debt and What to Do About It
Read the small print and make sure you understand your duties before signing any credit card deal. The total amount due, including interest and fees, will be repaid by you. By the end of the month, you might discover that you've spent more than you anticipated, all because the mental math of using a credit card is misleading.
To make sure you know exactly how much you owe, it's a good idea to either write down all of your purchases or check your credit card balance online. To ensure that your bank account accurately represents the actual cash available, set aside enough money to pay the purchases you have already made.
Think about some ways to rein in your spending if you've noticed you have a tendency to go overboard. Cut back on your monthly dining out spending if you find that you're spending too much. Until you wear an item, keep the tag on if you have a tendency to shop. If you ever experience buyer's regret, simply return the item and save the receipt.