starfishblues asked:
I mean, I understand the concept of building credit and everything, but what is the point of student credit cards? What is the purpose? I’m sorry if this is a silly question, but I don’t really get it.
And can you trade them in after you’re no longer a student for a “real” credit card? Do people just keep them forever? I always thought closing accounts lowered your credit score?
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so that studentd can practice???
It enforces the behavior of charging things to satisfy instant gratification, so that you will continue to use credit cards in the future.
The purpose of credit cards is to allow a person to purchase things without cash or checks, and consolidate their purchases into one bill they pay each month. It also gives you the flexibility to purchase things that you don’t have all the money for (financing), but remember that ability comes at a cost (interest/finance charges). This is true for both student cards, and “real” cards.
A “student” credit card is just a credit card that is targeted at college students; it often has rewards or perks that are aimed at college students. You can continue to use the credit card after college, or you can speak with your credit card company about changing over to a different card product that better suits your needs after school ends.
Student credit cards offer students with little or no income the opportunity to prove their creditworthiness. They tend to have higher interest rates than standard credit cards since students pose a higher risk of default. But the credit card companies want to gain loyal customers early– and see college students as a great opportunity.
Many BIG issuers have gotten into the ‘student credit card’ game. To see a complete list, visit:
When you decide to upgrade to a ‘regular’ credit card after school– don’t worry too much about closing the old account. Although it will have a slightly negative impact– it’s only short-term.
A “Student Credit Card” gives the young person the opportunity to build their credit while they are still in school.
This gives the young person the chance to prove that they can handle a lower line of credit while they are still young.
Most have a higher APR and are more restrictive. You may want to check with your local banking institiutes regarding their policies about this practice.
I would suggest opening a secured credit card instead. It’s the same thing, basically and gives you the opportunity to build credit AND learn how to manage money as well.
With a secured credit card you must put money on the card to use it. If you don’t have any money on it, you can’t use it.
Bank of America offers this to it’s customers and after ?9? months of proving you can pay your bills, turns it into a regular credit card. That sounds like a better plan to me.
Good luck.
Wait until you are 71 years old. Credit builders will advise you to take credit you can keep up with. The more credit you are able to handle, while managing taxes, home, food and other expenses, the higher your score will be “850″.
The only real benefit you will be getting from a higher score is the fee you will pay the insurance companies for your loans. For example the mortgage insurance will be 20% lower.
However, due to significant drops in stock holdings, the loans may include some increases that variate from one year to another, as the result of the stockholders needs!
If you have a credit card for 15 years, with absolutely great history of payment, hold to it indefinitely. You might need that one in the future. If you take new accounts, it might give the impression you had some struggle with debts before.
Any how take it easy, soon you’ll be in my age (71) and then nothing will matter anymore. Smile you are on the camera!