Credit Cards for College Students: Key Questions to Answer

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Credit Cards for College Students: Key Questions to Answer

Imagine this: you’re the parent of a college student who wants to apply for a credit card. At first, one word comes to mind: no. However, as you think about, you realize that there are several benefits of this arrangement. 

In the end, only you can decide if a credit card is right for your college age student. And even then, if they’re age 18 or older, you don’t have the final say. That’s harsh but true. 

Rather than immediately shoot down the idea, it’s better to research it and move forward with a defined strategy. This increases the likelihood of doing what’s best for you and your child.

Here are several questions you can answer, alongside your child, to better understand what comes next.

1. Why does your child want a credit card?

There should be a good reason for a college student to have access to a credit card. For example, to purchase books and other school-related supplies. Or perhaps to use in the event of an emergency, such as their vehicle breaking down. 

If there’s no legitimate reason for your child to have a credit card, there’s a greater chance that they’ll abuse it and end up in financial trouble. 

2. Do you trust your child to responsibly use a credit card?

This goes along with question #1 above. You know your child better than anyone else. Answer this question (honestly) and use the information to discuss your thoughts with your child. 

A child who has been financially irresponsible before accessing a credit card is more likely to go down the same path after. 

3. What are the benefits?

There are many high-level benefits of a college student credit card. For instance, your child may be able to use it instead of a debit card or cash. This gives them more spending flexibility. It also means less pressure on you to ensure that they always have enough money on hand. 

Another benefit is its ability to help build their credit history and credit score early in life. This can benefit them greatly upon graduating from college, such as when applying for a car loan or mortgage. 

4. What are the potential pitfalls?

You won’t have to look far to find a handful of potential pitfalls, but one stands out from the rest: your child running up a balance that they (or you) can’t afford to pay. If this happens, interest will accumulate. Or worse yet, if the account falls into default, it’ll have far-reaching ramifications on your child’s (and possibly your) credit report.

Final thoughts

These aren’t the only questions to answer when talking to your college student about applying for a credit card, but they’re among the most important. Do your best to steer your child in the right direction by providing them with the information necessary to make an informed decision.

Do you have any experience with this as a parent or a student? How did everything turn out?


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