|
Below, you'll find extensive information on leading
direct student loan articles and products to help you on your way
to success.
Student Credit Cards Explained
By Rudy Hadisentosa
Various people have different needs. So the credit card suppliers too have designed different type of cards. Besides the normal credit cards, there are small business cards for small business and then there are credit cards which are designed especially for students.
Now, what is different about the credit cards?
You could say not much, since all credit cards work in pretty much the same way and are used for more or less same purposes. However there are 2 main differences with the credit cards and these differences are on the 2 main aspects i.e. Credit limit and APR.
The credit limit for credit cards is generally very low. This typically ranges from $500 to $1000 per month. Some people might argue the reason for such discrimination. Well, the reason is very clear and obvious. Most of the students applying for these credit cards have never used a credit card in their life so neither do they have a credit rating and nor the knowledge about credit cards. While the former is what the credit card suppliers look for before supplying the credit card, the latter is what the credit card holder would like to acquire. Both the purposes are met by keeping a lower credit limit. The credit card supplier reduces the risk that they are taking by issuing a credit card to someone who has never used one and has no credit rating. It’s good for the credit card holder too since this reduces their risk of damage which can be caused by limited or no knowledge of credit cards and by bad spending habits. Moreover, this credit limit would be sufficient for the needs of a in general.
The APR on the credit cards is generally higher than that on the normal credit cards. Again the reason for this is same as that for lower
credit limit i.e. the credit card company or the credit card supplier is after all into business and has to take steps to mitigate any possible risks including the risk arising from issuing a credit card to someone who is nai"ve in terms of credit card knowledge.
The credit card companies might also keep some stricter terms and conditions on the credit cards and generally require a parent or a guardian’s signature as a guarantor.
Since credit cards are more of a necessity than a convenience in today’s world, the credit cards are much recommended, especially as a learning tool in getting the students prepared for the life. Due to their inherent characteristics of low credit limit etc, credit cards cannot lead students into a totally irreversible debt situation. Students should read all the instructions supplied with their credit card. This first credit card will teach them how to protect themselves from credit card fraud, where all to use their credit card, how to control their spending, what the various membership benefits are etc. The earlier they learn these things the better it is.
Moreover, the credit card will also help you in developing a good credit rating. You shouldn’t take the credit cards lightly. If you overspend on your credit card or default on your credit card bill payments, you will not only end up paying interest on your credit card balance but also spoil your credit rating. Remember that a bad credit rating will not only hamper your chances of getting another credit card later in your life but will also lead to problems in approval of your mortgage/car-loan applications etc.
So credit cards are a surely a good way for students to start with credit cards.
CCN.com is a free online credit cards reviewand application website. We offer credit cards selection from visa,master cards, discover, american express and many others. We have quite some categories and hundreds of credit cards selection to fit your need. Apply for a credit card at CCN.com.
|
|
We strive to provide only quality articles, so if there
is a specific topic related to student that you
would like us to cover, please contact us at any time.
Contact
And again, thank you to those contributing daily to our
direct student loan website.
Student Loan Resource [student.cc-ebiz.com]
|
|
