Protecting Your Privacy: We will never call or email you asking for money. There is no fee to apply. Close

Comparing Credit Cards: A Guide for Students

Financially savvy parents and students understand that college is a great time for young people to open their first credit card account.

A college credit card helps students jumpstart their credit history and build their credit score, setting themselves up for success in the future.

As Lisa Heffernan, who writes a blog for parents of young adults points out, failing to help kids establish credit constitutes a "kind of parenting error."

A student's credit score is just as important as their GPA.

Parental involvement in their students' early credit card career is crucial.

I did not have the benefit of parental guidance when it came to credit cards.

My parents simply paid for everything with cash, and held the mindset that if they could not afford to pay cash, we did not need it bad enough.

While this was a great lesson in saving, it did nothing for building a solid credit history.

There were no guides back then, which is why I felt it to be important to include this information here.

In order to build this kind of constructive parent-student credit card cooperation, we've built onto our college financial prep class by putting together the following credit card comparison guide for students.

This guide will help you decide which credit card is best for your student.

Four Things to Know

Only college students qualify for student credit cards.

Credit card companies have created credit cards specifically tailored for college students.

In order to qualify for these cards, students should be enrolled at a 2- or 4-year university.

Average student credit limits

Some card companies infrequently allow non-students to apply for student cards.

But if you're a non-student applying for a student card, it can result in a hard pull on your credit report, which you want to avoid since it will ding your credit temporarily.

Often times, the credit card company can verify your status as a student without needing you to supply any documentation.

But it doesn't hurt to have a student ID or transcript handy because sometimes it can speed up processing.

Age and citizenship matter. In order to qualify for student cards you must be over 18 years old and a U.S. citizen.

Folks under the age of 18 should consider becoming an authorized user on their parents' credit card accounts.

This way they can still learn important lessons about managing a credit card even though they don't have their own credit card account yet.

But, if mom and dad's payment history is not so good then don't go the authorized user route because, as Teresa Dixon Murray of cleveland.com has observed, the kid will inherit their parents' bad payment history and this will hurt the student's credit score.

Luckily, there is no age cutoff for student credit cards.

So long as you're enrolled at your university (and assuming you meet the other profile requirements), you can qualify for a student credit card with most major credit card providers.

You'll probably need some income. If you're under 21 years old, then you must be able to show the credit card issuer that you have some income, even if it's just from a part-time job.

Otherwise, students will need a cosigner, like a parent or guardian, on their application.

Today, in the age of the internet, account monitoring is easy, which makes co-signing easier than ever.

Back in the day, co-signing was riskier since it was more difficult for parents to monitor their kids' credit card activity.

Nowadays, parents can easily login in via their smartphone or laptop to make sure that the kids aren't getting into too much trouble with their new cards.

Check your credit history. If a student already has bad credit, he or she likely won't qualify for a student credit card per se, but there are other options for them, like secured cards (more on this below).

Most students who have never had a credit card and who haven't been an authorized user on their parents' cards won't have a credit history.

This is ok.

Credit card companies understand, and there are options for you.

Reap Rewards Tailored for Student Life

Student credit cards offer rewards specifically designed for the needs and wants of college life.

When evaluating different cards, students should think about their upcoming expenses, reflect on their past spending habits, and then choose the card with the maximum benefit.

Not every student is the same, so different rewards packages serve some students better than others.

Where do students spend their money each month

Get cash-back on textbooks.

Some cards, like the Discover it Chrome for College Students (reviewed below), offer cash back that's easily redeemable via Amazon.com, where many students buy their textbooks.

With Chrome for College Students, students earn 1% cashback on all purchases and 2% cashback at gas and restaurants.

Rack up points eating out.

Students bogged down with exams and essays often don't have time to cook for themselves.

Instead of fueling up with unhealthy snacks and instant meals, eat out and pad your wallet.

For example, with the Citi ThankYou Preferred Credit Card for College Students (reviewed below), students get 2 ThankYou Points per dollar spent at restaurants.

And "restaurants" includes not just typical dining establishments, but also bars and cafes.

Binge watch Netflix at a discount.

When you use your student card to pay for entertainment, you earn points, which are redeemable for a whole range of prizes, including gift cards and Amazon purchases (think: books, headphones, and new shoes). "Entertainment" could include Netflix, but also concerts and movies.

If you're a TV head or a movie buff, the Citi ThankYou Preferred serves you best (see review below).

Jump-start payments on those student loans.

Credit card companies understand the student grind.

They know that students have important purchases to make now as well as long-term financial responsibilities like their loans.

The Commence Mastercard (reviewed below) allows students to balance these priorities, helping students help themselves as they live away from home for the first time, AND rewarding them for thinking about the future by paying off their credit card debt while they're still on campus.

Grow your credit knowledge.

All good student credit cards encourage young people to learn about credit as well as how to manage their credit cards.

But some credit card companies are better than others when it comes to how well they empower students to learn.

For instance, pay attention to how well a credit card issuer's app allows a student to track and monitor their FICO credit score.

In the long run, the student credit card is a means to a better credit card later on.

So, if a student doesn't pay attention to how their credit is doing, the whole endeavor could prove counter-productive, and they could even end up with a sizable amount of credit card debt.

Three Things to Pay Attention To

Each student is different. They have different needs and wants as well as different financial circumstances. Are they anticipating big purchases throughout the year, like a new laptop in the fall and a new iPhone in the spring?

Do they invariably watch an hour of TV before bed? Are they planning on studying abroad? These are all important questions to keep in mind when choosing a student card.

Weigh APR incentives against reward packages.

For example, some cards, like Discover it Chrome for College Students, offer zero intro APR on purchases during the first six months.

So, if you know that you need a new laptop or cell phone in the first month of the semester, choosing a card with this APR incentive might be better than a card that offers higher cash back on entertainment purchases.

Even if you watch lots of Netflix, zero intro APR on your purchase of a new laptop will likely serve you better in the long run.

After any special intro APR deals expire, most student cards have APR ranging between 13.99% and 24.99%, depending on the student's credit history.

So, in terms of APR, student cards don't differ much from regular credit cards, which is helpful because it teaches students what to expect from their future credit cards.

If you don't have any credit history yet, you'll likely end up with an APR toward the higher end of the variable range.

Don't fret though!

As long as you pay your balance off in full each month you won't pay any interest.

No fees, no problem (generally).

Almost all student credit cards come with no annual fees. Low fees, in general, are a common feature among student credit cards.

Credit card companies know that students are often strapped for cash, so they don't want to discourage students from opening credit card accounts by hitting them with lots of cumbersome fees.

However, some cards better suit students who are totally new to credit cards (and who are therefore likely to forget a payment or two), whereas others aren't as forgiving.

Digital resources make paying bills easy.

Years ago, student credit cards might've tripped students up, hitting them with debilitating late fees.

Now that's less likely.

Today students can go online and pay their bills with relative ease.

Reminders on students' smartphones set to recur every month alert them when it's time to pay their bills, reducing the risk of a missed payment and making the whole process just that much more effortless.

US college student smartphone users

In our experience, we've found that Chase Bank has an especially user-friendly web interface.

Students will find it intuitive and easy to use (and hence will have no excuse for not paying their bills on time!).

Graduate from school and to an unsecured card

Folks new to the world of credit cards may be surprised to learn that there are actually two main families of credit cards.

While it's inaccurate to say one is "better" than the other, students should educate themselves on the differences in order to understand when and how each kind of card may serve them best.

Secured vs. unsecured.

The way to go for people with limited credit, no credit, or bad credit is a secured card.

A secured card is backed by some sort of collateral, often a cash deposit (aka a security deposit).

Thankfully, students are not the only ones in this country without a credit history. Roughly 45 million Americans have limited or no credit score, as Michele Scarbrough recently reported in her blog for the Consumer Financial Protection Bureau.

In response to this common financial situation, most credit card companies offer at least one secured credit.

Later you can graduate to unsecured credit cards.

After responsibly and constructively using your student credit card by making regular purchases and paying bills on time, students will improve their credit score and qualify for unsecured cards.

Unsecured cards (which are the vast majority of credit cards out there) don't require a cash deposit and come with higher credit limits, so as a student progresses through undergrad, he or she will be able to make larger and larger purchases on their cards.

No more stressing about those beginning-of-the-semester textbook expenses.

Take Jane's journey for instance: As a freshman with a secured card, Jane might only be able to spend up to $200 a month (maybe enough for eating out a couple times a week).

But when Jane uses her card well and builds credit over the years, she'll enter senior year with an unsecured card.

As a result, Jane will be able to buy plane tickets and a hotel room in Florida when spring break comes around.

A Breakdown of the Best

The Discover it Secured Card is best for the credit newbie

A secured card likely best fits the needs of freshmen and sophomores.

With no credit history, they will need the chance to build their credit before they can graduate to an unsecured card.

The Discover it Secured Card is a safe bet here.

It will forgive you for missing that one payment by not charging you a late fee, while also offering rewards for spending money on the things you love (read: pizza and gas in order to drive and pick up said pizza).

Notable fine print

Annual fee. $0

APR. 23.99% (V)

Perks

  • No late fee on your first late payment
  • 2% cash back at restaurants and gas stations
  • Free access to your FICO credit score

Pitfalls

  • Security deposit: minimum $200
  • No intro APR on purchases

What experts say

We recommend this card specifically for people looking to graduate to an unsecured card soon.

In as little as seven months, they could return your deposit and switch you an unsecured card!

With careful review to make sure that your credit is growing and you're being responsible, you could get an increased limit in less than a year.

What consumers say

Jeff, commenting on beverlyherzog.com, shared his experience raising his credit score with breakneck speed using the Discover it Secured Card. Jeff started with a FICO score of 554, and then "after only one payment made on time it [had] risen to 591."

How it stacks up

This is a real credit card, and so unlike a prepaid and a debit card, it helps you build your credit, setting you up for an unsecured card later on.

Keep in mind that this is a secured card, and so, unlike the other cards reviewed here, it requires a security deposit.

Hopefully, you can save enough cash in the summer leading up to the start of the semester to cover the deposit.

Maybe mom and dad will be generous enough to toss in $20 or $40 (after all, it's for a good cause!).

Perfect for the new student of credit. The Discover it Secured card keeps you updated on your FICO Credit Score via Discover's mobile app for free — which is a nice perk, especially considering how credit-reporting agencies have recently misled consumers into buying credit scores.

This deal allows you to stay updated and watch your credit grow as you make purchases and submit your payments on time.

Cash-back matching is double rewards. This card also offers the kinds of rewards that college students will love, like 2% cash back at restaurants and gas stations.

For parents, these rewards provide exactly the kind of incentive that your student needs for developing good credit card payment habits.

For students, they don't need to worry about forgetting that you have these cash-back rewards because with this card your cash-back rewards never expire.

Even better, after the first year, Discover will match all of your cash-back rewards that you've earned, doubly rewarding your responsible behavior.

Lose it, just Freeze it. Students have been known to lose things (like wallets) in the mix of football game days and late-night parties.

If you lose your Discover it Secured card, just access the handy Freeze it feature on the Discover mobile app or online, and freeze your account within seconds of realizing that you've lost your card.

If you find your card (maybe it was in the other pants), this Freeze it feature allows you to turn on the account just as easily as you froze it.

(Note that the Discover it Chrome, reviewed below, also offers the Freeze it feature and the free FICO score.)

How to apply

Head over to the Discover website to learn more and apply. Just have your banking routing number, account number, and Social Security number ready.

Discover it Chrome for College Students rewards academic achievement

If you've tried the Discover it Secured Card and enjoyed your experience with Discover, then try the Discover it Chrome for College Students.

It offers very similar rewards, so you won't have to worry about changing your spending habits to continue maximizing your rewards.

Plus, parents and students alike will like how this card incentivizes good grades.

College students and technology

Notable fine print

Annual fee. $0

APR. 0% intro APR on purchases for 6 months. 10.99% intro APR for 6 months on balance transfers. Then 13.99% - 22.99% APR (V).

Perks

  • $20 cash back each school year your GPA is 3.0 or higher for up to the next 5 years
  • Dollar-for-dollar match of all the cash back you've earned at the end of your first year, automatically
  • Cash back never expires

Pitfalls

  • Decent credit history required
  • Cash back offer excludes purchases from places frequented by students, like warehouse clubs, wholesale distributors, and discount stores

What experts say

Napala Pranti, writing for Credible, points out that this card won't fit everyone's spending habits, but emphasizes the fact that Chrome for College Student offers an opportunity to both build your credit as a student while earning cash back on ALL your credit card purchases.

What consumers say

Brennan, commenting on Discover's post on amazon.com, raved about how this card helps students looking to improve their credit.

He added that, "As long as you pay your bill off on time and in full, you shouldn't be having problems with Discover at all!"

How it stacks up

Basically, Chrome for College Students offers all the same benefits that the Discover it Secured card does and more.

The catch here is that you must have a decent credit history in order to qualify.

So, if you've already had an unsecured card for a while and you've maintained a strong credit score, maybe it's time to upgrade to the Chrome card, which will continue to be useful post-graduation.

Advantageous intro APR. One advantage that this card has over the Discover it Secured card is its APR plan.

APR stands for annual percentage rate, and it's the interest rate that determines the charges that you pay on your account.

Chrome for College Students offers 0% APR on purchases for the first 6 months, which is great if students acquire their card at the beginning of the semester when they have to pay for things like books, new furniture for their apartments, etc.

Average estimate undergraduate budgets

Good grace incentives. This card also rewards students for strong academic performance.

If they earn a 3.0 GPA or higher during the school year, Discover will give students $20 at the end of the year.

And direct cash incentives often do work for improving students' performance, as money coach blogger Lynnette Khalfani-Cox explained on her Family Finances blog.

How to apply

Check out Discover's website and apply now. Just have your banking routing number, account number, and Social Security number ready (this applies for all credit card applications).

The Commence Mastercard is great for the student with loans

We've all heard about how many students are struggling post-graduation with paying off their student loans.

Well, Mastercard has too, so they've synthesized exactly the card for the student worried about paying off those cumbersome loans.

And it's unsecured, so no security deposit required!

Notable fine print

Annual fee. $0

APR. 0% intro APR for 15 months on balance transfers made within 45 days of account opening, then 14.99% or 21.99% on purchases; 23.99% (V)

Perks

  • Earn 2% cash back on grocery store and utility purchases
  • 25% rewards bonus when cash back is redeemed to repay student loans
  • Free access to your FICO score

Pitfalls

  • No intro APR deal on purchases
  • Higher lower-limit on possible APR than other student cards

What experts say

Ben Luthi, writing for Student Loan Hero, praises this card, calling it "a novel way to pay down your student loans."

What consumers say

The Commence Mastercard replaced a widely popular card from Sallie Mae last year, and consumers were NOT happy, like Willis writing on creditboards.com: "I thought it might still have a useful rewards program in some way. But 1% and 2%. Nope. Into the sock drawer it goes."

But keep in mind that many of the negative reviews of this card focus on the inferior cash back deal of this card versus the older version, and they tend to discount how well this card serves students paying off their loans.

How it stacks up

The last two cards offered great rewards tailored for recurring needs, like gasoline and food.

The Commence Mastercard offers these kinds of rewards (2% cash back on groceries and utilities) and more.

Extra cash-back for loan repayment. Get a 25% rewards bonus when cash-back is redeemed to repay student loans.

As student loan repayment becomes even more difficult these days (as described in all its disturbing detail by Donna Rosato), this offer by Mastercard could provide a much-needed assistance for current students and graduates with loans.

Combined undergraduate and graduate debt

Free credit score checks. Like with the two Discover cards, the Commence Mastercard offers free access to your FICO score, which (again) is great for students learning how to build and maintain a good credit score.

Better cashback, worse APR. Notice, though, that this card does not have the same great APR deal as the Chrome for College Students card.

Instead, the Commence card gives you a $50 cashback bonus when you make a purchase on your card in the first 90 days, which is almost definitely not as good a deal as the 0% APR for the first 6 months.

Maybe that's a dealbreaker if you still need to buy books, a TV, or a futon for your apartment.

But if your student loan covers these sorts of expenses, then perhaps this relative disadvantage of the Commence Mastercard doesn't matter given your specific situation.

How to apply

Mosey on over to Barclay's website, and you can apply now with just a few clicks.

Journey Student Rewards from Capital One encourages responsible credit behavior

This card is for students who already know that they are responsible credit card users.

Yes, this card does potentially have high late fees, but if you trust yourself to consistently pay your bills on time, Journey Student Rewards from Capital One gives you big rewards.

Notable fine print

Annual fee. $0

APR. 24.99% (V) on purchases and transfers

Perks

  • 1% cashback on all purchases, AND every month you pay on time, that 1% cashback increases to 1.25% cashback
  • After making 5 monthly payments on-time, you can raise your line of credit
  • Sophisticated text and email fraud alert system
  • No foreign transaction fee.

Pitfalls

  • No introductory interest rate
  • Cash back rewards can expire
  • Late payment fees as high $35

What experts say

Jeff Gitlin, writing for lendedu.com, highlights how this card rewards good bill payment habits. "Cash is always needed from a student perspective, so the cash back rewards are sure to come in clutch for any cardholder."

What consumers say

Chris, posting on creditcardforum.com, highlighted the great rewards of this card, saying, "I love my Journey credit card! I was approved for a $500 credit limit. The rewards are awesome."

How it stacks up

Journey Student Rewards from Capital One gives responsible students the chance to upgrade their cards and improve their line of credit.

In the meantime, they can enjoy the competitive cash back deals, which students can use on everything from household items, to Uber rides, to textbooks.

Sound choice for study abroad. For students planning on studying abroad, this card might be the way to go.

No foreign transaction fees are pretty nice, and if you know that you're going abroad for a semester, Journey Student Rewards should be a no-brainer.

Host regions of US study abroad students

The downside is there's no introductory APR, so this card has a competitive disadvantage compared with the two Discover it cards mentioned above.

Perhaps Capital One tries to compensate for this lack by offering better cash back rewards, but it still comes up a bit short compared to the competition.

Raise your line of credit. After demonstrating to the card company that you have strong credit habits, they will reward you by raising your line of credit.

This higher limit allows you to purchase larger items, the kind that often comes post-graduation when students move to places and need things like household appliances.

So, if you're heading into senior year with strong credit and you see yourself moving to a new city when the year is out, this card could prove pivotal in your transition.

How to apply

Head over to Capital One's secure website and apply now.

Citi ThankYou Preferred Card for College Students benefits the big spender

This card best serves those with some established credit history — for example, those trying to graduate from a secured to an unsecured card.

If you're anticipating big purchases to make throughout the school year, but don't necessarily have time to price check, then the Citi card, with its special Price Rewind feature, is best for you.

Notable fine print

Annual fee. $0

APR. 14.99% - 24.99% (V) based on your creditworthiness

Perks

  • 0% intro APR on purchases for the first 7 months
  • Win 2,500 bonus ThankYou Points after $500 in purchases within 3 months of account opening
  • 2X ThankYou Points on Dining Out & Entertainment
  • No expiration and no limit to the amount of ThankYou Points you can earn with this card
  • Special offers exclusive to Citi Bank, like Citi Private Pass and Citi Price Rewind

Pitfalls

  • Requires a decent credit history
  • Citi smartphone app has proven to be inferior to other banks apps

What experts say

Christina Majaski, writing for WiseBread, focuses on the Citi's signature benefits. "Citi's Price Rewind and Private Pass are attractive especially for college students who are interested in special events and VIP access. The Price Rewind feature can help save money if students don't have the time to shop around for the best price."

What consumers say

Briana, commenting on an article on doughroller.net, emphasizes the versatility of ThankYou points system. "The coolest thing about the Thank You Rewards is that if you get enough, you can get a credit towards your credit card bill, which is essentially free money."

How it stacks up

This card includes a stellar intro APR deal that lasts longer than all other cards reviewed here.

So, whereas the Discover it cards benefit students with lots of expenses at the beginning of the semester, the Citi ThankYou Preferred Card for College Students can sustain students throughout the entire year if they have a few big purchases planned.

Great APR AND Special Citi ThankYou Points. If you take advantage of the Citi card's great intro APR, you'll likely pass the $500 threshold on purchases that qualify you for 2,500 bonus ThankYou points.

Then you can cash these points in for fun college purchases right away, splurging on pizza or warm attire for football games.

Otherwise, you can save your ThankYou points without a worry because they never expire!

Citi Private Pass gives you special access to events and exclusive ticket presales.

Occasionally, it can even earn you preferred seating at concerts and sporting events.

Favorite ballpark food

Credit newbies, beware. This card requires a decent credit history, so, like the Discover it Chrome for College Student, Citi ThankYou Preferred for College Students might best serve upperclassman who have already had the chance to build some credit.

How to apply

Head over to Citi's website to learn more and apply.

Start now, save later

Credit card companies offer cards and plans to fit just about all students needs.

Whether you're a freshman with no credit history or a rising senior who is making the transition to professional life, one of the above cards should fit your needs.

You will thank yourself later for taking the effort now to choose the right card.

Before we go though, here's a little cheat sheet with all the biggest takeaways from our student credit card comparison guide.

The goal of your first card is to build a healthy credit history. Focusing on the rewards off the bat is not the priority.

The biggest reward of any credit card is helping you build an "excellent" score to help you once you graduate.

Keep an eye out for cards with sophisticated digital tools. Issuers like Discover offer acclaimed apps that make your FICO score a tap away.

Other issuers offer auto-pay systems and push-notification reminders to help you get familiarized with your card.

Later you can graduate to unsecured rewards credit cards. If that means putting down a deposit and starting off with a secured credit, do it!

Just like a great GPA opens up doors to your dream job, a great credit score might land you your first car or home.

A year, two years, or maybe ten years down the road, when you're applying for car loans or even signing a mortgage, you'll reflect back on your decision to open that first credit card account or upgrade your credit card, and you'll see that it made all the difference.

My decision to open that first credit card was an easy one, but this was some time ago before credit cards had rewards programs like those offered now to college students.

I applied for a gas station credit card, and began building credit by paying off the small balance I had at the end of the month.

This also gave me flexibility with cash reserves, which every student might need at some point.

Thanks to that one credit card, I was able to get approved for more and more credit, and ultimately have an above average credit score now because I began building my credit so long ago with that one card.

Now that you've taken advantage of this guide about comparing credit cards for students, it's time to learn how to make the best of it.

Are you a college student already with a bunch of credit experience under your belt?

A graduate who's now playing catch up?

Let us know your experience by dropping a comment below.


Leave a Comment