Student Credit Cards

Student credit cards can be a good way for young people to establish credit as well as prepare themselves for any emergencies. The card can come in handy if a tuition check is late arriving in the mail, you get into an accident or want to take that spring break trip to Cancun. There are positives and negatives associated with students having credit cards as you will learn in the following paragraphs.

Safety With Student Credit Cards

Situations may arise where your child, or you as a student, face a financial crisis and need the option of paying for something on credit. Some registrar's offices may be lenient when waiting for a loan or scholarship check to pay for tuition. Others may stick to strict deadlines and force the student to withdraw from classes unless payment is received. Being able to pay for tuition on a card may save your student a semester of classes.

Another advantage of student credit cards is that they generally offer low introductory rates and below average rates following the expiration of the introduction period. Having a lower rate can save thousands in finance charges and make the monthly payments much more manageable. Having a credit card while in school also allows the student to build a credit history that can be used to buy a car or house after graduation.

Possible Dangers

Once a student credit card account is opened it is important to teach the student about financial responsibility and educate them with some of the possible negative consequences. Having a card is great for an emergency but can cause financial problems down the road. The card should only be used for important purchases and should not be relied on for day to day costs. Since many students are unable to work while attending school once they get into debt it is hard to ever recover. Missed deadlines or non-payment can seriously cripple their future buying power.