About Student Credit Cards
If you’re going off to University or College then it’s more than likely you are going to be targeted by credit card companies offering you great incentives and cool free gifts and discounts to sign up for their ‘Student Credit Cards’. While these offers may sound great and are extremely tempting there are several things you should take into account.
You may well already have taken out a student loan, and you may have an overdraft, so the first thing you should ask yourself is: do I really need a credit card? You’ll no doubt already be on a tight budget so by taking on a credit card you will need to be sure you can make all your repayments. If you decide you do want one then there are some benefits to be had especially if you shop around to see what cards are available to you.
Student Card Incentives
The main benefit of a student credit card is that it lets you borrow without needing to have any regular income. They also offer students many incentives to take out their cards like discounts on CDs, DVDs, Computer games and even discounts on clothing, but don’t just apply for a card because it offers discounts or free gifts. Look closely at what the card companies are offering as you will be able to get many of the same discounts and incentives by using your NUS (National Union of Students) card, so these offers may not be worthwhile.
If a card is used properly it can also offer added convenience and an additional source of money between student loan instalments. You should try and use your card as a short term stop gap when your funds are low and pay back what you owe, in full if you can. Don’t get the idea that your credit card is just ‘free money’ to spend. Any purchases on your card will have to be repaid with interest, so you have to take into account these repayments in your budget, or you could end up with a large debt.
You should be looking for card that offers low interest rates, a good APR, one that has a low or no annual fee, an anti-fraud guarantee, good customer service, and any incentives that may be of real benefit to you.
Student Credit Cards very often charge a higher than normal interest rate so it is worthwhile doing some research and comparing all types of card and not just student cards before making a decision on the card that best suits all your needs.