Student Credit card how does it work? Let’s start by first knowing what student credit card is about. A Student Credit Card is made with the assumption that the student does not have a credit history or it is limited. Or likely the person it’s a having a credit card for the first time. Furthermore, student credit cards are often do have bonuses or rewards program made specifically toward the lifestyle of the student. This cards also sometimes do have higher penalty fees and lower limits than other credit cards.
How Does Credit Card for Students Work?
In a normal credit card, you can spend money up to your normal credit limit. In as much as, you make full balance paid off by the due date each month, you won’t pay Interest on what you have borrowed. A student Credit card can help you sort out your finances, by granting you access to delay payments on purchases made for a certain period of time.
No Credit History
As a student, you may not have an existing credit history, which makes it difficult for banks to give you a feedback on your financial expenses. You’ll notice also that the terms and conditions often are not as favorable as the one of a credit card of a full time employeethat has a good credit history.
However, if a student credit cards are used properly it can be cheap, or even cost-free way to borrow money and add a bit more flexibility to your finances
How Does A Student Credit Card Work? Benefits
Almost all the major banks and many other card issuers now offer a credit card for students. Here are a few common benefits on Student Credit cards;
- It helps in building credit history while studying.
- A low credit limit to ensure that things are in control, usually around 500.
- Credit Interest free period up to 56 days to pay off debt before beginning to pay Interest.
- Great Rewards and perks, with special offers.
Finally, if you’re prompt in your payment and stay within your credit limit, and pay off what you owe before striking time, the Credit card for students can assist you to develop a good financial habit.
How Does A Student Credit Card Work? Tips to manage your finances
As a student, there’s a great need to manage your finances. It begins with setting your budget at the beginning of the semester. Your loans plus any savings or income you may have, minus your tuition fees, rent, mobile phone bills and any regular essential needs. The remaining is for your feeding, transport and social activities for the rest of the semester. As a student, you’re entitled to lots of discounts and deals. Use them to get what you only need.
Do not assume you need a Student Credit Card. Note that, they’re not free money instead, see it has a convenient way to shuffle money around. If you’re not able to repay what you owe, you could get into more debt and at the end damage your credit score.