How to use a Student Credit Card to Create Good Credit

Credit for college students is a topic of much debate.  There is concern among parents and experts that students can harm their credit score before even starting a good job if given access to credit.  It is certainly possible, however, for a student to accomplish just the opposite by creating  a good credit score early in life that can be built upon as one matures.  Here are some ideas on just how to achieve that more positive goal.

Use just one single card. A student’s credit card should be used for emergencies while far from home and to establish some initial, positive credit.  You don’t need more than one card to realize this objective.

Avoid carrying a balance forward.  Pay off the entire amount every month.  This will help the student to avoid fees and interest attached to carrying a balance forward.  It will also teach them that a credit card does not represent “extra money”, since this money will come due every month.

Check the offers of more than one card issuer. Marketing to students is a mainstay of the credit card business and the offers are rarely as good as they seem upon your first survey.  Read the fine print in detail and shop for the best deal by comparison, not by offers of rewards or bonuses.

Read the application carefully.  You should particularly examine the penalty for late payments and the interest charged should your payment come overdue.

Check every statement you get and place it in a file. Sometimes mistakes are made and you may have to refer to a previous statement to correct one.

Always protect your identity in association to your card. Identity theft is real and it can pose some troublesome problems if you’re affected by it.

Establishing and preserving good credit is work.  If you like avoiding work, don’t get a credit card because you’ll only suffer for it.  On the other hand, if you feel you are responsible and mature enough to follow the guidelines set out here, you deserve the benefit of establishing a good credit record as a student and a credit card is a logical way to get that good rating.

The idea of getting a new credit card is very exciting, when you are a student. But credit card is not just for spending. You can build up your credit with that. How to do that?  Chintamani Abhyankar offers useful tips on strategies to create good credit history for students.