Student Borrowers – Study the Fine Print


A credit card can be highly advantageous to students who are looking for a bit of the boost to the money they can spend – however, this doesn’t mean that you shouldn’t study the fine print in advance.

If you are young and looking for credit, it is likely that you will not have had experience in finding a great deal before. In this case, there are several things which you should prioritize finding over everything else, and these are:

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  • Interest rates. You need to compare and contrast interest rates when looking for student credit cards. Even though you may not be able to get the lowest deals around (and this is because you are new to the lending market and haven’t got a reputation through your credit score yet), you still look around and read the fine print of different credit card descriptions to figure out which one aligns best with your needs.
  • Early termination of contract. Should you require to end the relationship you have with a credit card provider early, and intend to pay off your balance in full, you should ensure that the lender won’t levy a higher-than-normal interest rate for your final repayment.
  • The benefits of going with a particular lender. They say that some of the best things in life are free – and you certainly should look out for the advantages that some credit cards provide as unique selling points. This could be generous levels of cash back with your purchases (with some services offering $100 when you spend $500 in 90 days); or discounts on travel and accommodation-related products. If you are making a journey back home to be with your family, this could be more useful than you would envisage.

Before you apply, you should also ensure that the lender is offering a card that is tailored towards students. This way, the lender will be far more lenient on the matter of your credit score, a measure of your financial reputation that is usually built over time. This score is usually referenced by lenders when you make a request for a credit card, but as you will have little to no financial background with your application, a declination on your first attempt could leave a footprint on your report that could damage your future prospects. At the beginning of your life as a consumer, this is the last thing you need.

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A top tip to ensure that you get a fair deal is to get someone who has applied for a credit card before – such as a parent or a friend – to review the contract you receive and scrutinize the fine print for any terms and conditions that might be questionable. You should also ensure that you use your card responsibly once the plastic is sent to you. By spending within your means and ensuring that you budget the money you receive from your job carefully every month, you will minimize the risk of something going wrong with your credit card.

Student credit cards are a great way for you to get experience in financial responsibility, and if your first tenure as a borrower goes successfully, you will be able to take advantage of cards with lower levels of interest in the future – meaning that the cost of credit will decrease substantially.

Connor Stephens is a writer from London, covering personal finance tips with a global perspective.  He teaches his two young daughters that personal finance wisdom starts at home.

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