Once you reach the age of 18, maybe you’re off to university, living at home with your parents, or moving to a new city, you might consider getting a credit card. If you use your card responsibly, read and understand all of the details, having a credit card can be an excellent way to build a credit history and establish a credit score.
Some benefits of Student Credit Cards
Credit Score: Building a good credit history is important. It will effect your opportunities for borrowing in the future, like buying a house, getting a loan for a car, and so on. Having a credit card from a young age will help create a good foundation for a credit score, which is the basis of qualifying for loans. However, if you use your credit card irresponsibly, like not paying it off, then it can take years for your credit history and credit score to recover. Just like standard credit cards, you should aim to pay off your balance in full each month and keep your credit utilization low.
Access to Money: We all know money can be tight when you’re a post-secondary student. Maybe you’re working part-time and your hours vary every week, so sometimes you don’t have as much cash on hand as you need. Having a credit card for necessity purchases and emergency situations is a great idea, as long as you can budget to pay it off in full when the bill comes. Nowadays, credit cards have also become the norm for buying things online like concert tickets, and more.
Consumer Protection: Credit cards often offer protection for consumers on many different items. For example, if you purchase a cellphone on your credit card, you may get an added mobile protection plan from your credit card supplier. It’s always a good idea to check the fine print and check in advance if there are any extra fees for taking advantage of the consumer protection plans. Some cards even offer travel insurance and extra warranties.
Interested in a Student Credit Card? Check out our great offering – Estonian Credit Union Collabria Mastercard.