As a student you have more important things to worry about than getting from payday to payday, especially if you’re only working part time. Most students work casual jobs and some weeks you’ll get plenty of hours and other weeks only a few. A Student credit card is designed to help you manage your spending so you can balance the good times with the lean.
What Are The Benefits of a Student Credit Card?
Like mentioned above, credit cards are excellent for managing your spending whether you’re a student or not. Let’s face it, unexpected expenses are always bound to come up and usually when you’re having a lean week.
With a credit card you can pay those expenses easily and then put money back on the card when you get your next pay.
Getting a new credit card will also allow you to build a good credit rating early in life. This will make it easier to secure a larger loan. For example a car loan, further down the track when you’re ready for it.
A credit card will also teach you to manage debt before you start thinking about making more substantial purchases like a house or an apartment. Try to pay off as much as possible at the end of the month to avoid paying too much interest.
Some cards have an interest free period so if you pay it off before the end of the period, you’ll pay no interest. This is great ‘training’ for when you need to manage larger debts in later years.
What To Look For In A Student Credit Card
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Credit Limit
Make sure you apply for a realistic maximum limit that won’t get you into serious debt. For example, if your monthly average earnings are say $1000, set your credit limit no higher than this.
With a low interest rate you’ll minimize the amount of interest you pay. Having to pay excessive interest is usually the reason most people can’t get out of a debt situation so avoid this by choosing a card with a low interest rate.
Try for a credit card which has no annual fee. If possible you should try and find a card with both a low interest rate and no annual fee and a lot of student credit cards fall into this category.
Lastly, try and only use your new credit card for essentials. Create a monthly budget and stick to it. You can choose to pay your credit card more regularly than monthly and this will minimize the interest you pay.
Also remember to pay at least the minimum required payment each month and never miss a payment as this will adversely affect your credit rating.
