Student Credit Cards Explained: A Beginner's Guide

What is a student credit card and who qualifies?

A student credit card is a type of credit card designed specifically for students enrolled in higher education, with the primary purpose of helping them establish a credit history. These cards are typically marketed toward college and university students and are often more accessible than regular credit cards for people with no credit history.

Generally, student credit cards are available to full-time or part-time students enrolled in a two- or four-year college or university, and some may be available to trade school students. Applicants must be at least 18 years old; if you are under 21, you will need to provide proof of independent income or have a cosigner. This requirement stems from the Credit CARD Act of 2009, which was designed to protect young people from taking on debt they can’t afford.

Because they target students who may not have a credit history, many student credit cards are available to applicants with little or no credit history, and some issuers do not require a credit score.

Sources: Chase, Experian, Sallie Mae, Consumer Financial Protection Bureau (CFPB)

Key features and terms: APR, credit limit, fees, rewards

Student credit cards share many features with regular cards, but some elements are tailored to the student experience. Here are the terms you’ll see most often:

• APR (Annual Percentage Rate): The interest rate charged on balances carried from month to month. Student credit cards often have higher APRs than standard cards.
• Credit limit: The maximum amount you can borrow. Student cards typically come with lower credit limits than regular cards, which can help encourage responsible spending.
• Fees: Many student credit cards do not charge an annual fee, making them a low-cost way to start building credit. Other fees, such as late payment fees, may apply.
• Rewards: Some student cards offer rewards, such as cash back or points, tailored to student spending habits. Issuers may also include educational resources to help you learn about credit.

Sources: Chase, Experian, Forbes Advisor, Sallie Mae

Differences from standard credit cards: no credit history requirements

Regular credit cards generally require an established credit history and steady income, which can be a barrier for many young adults. Student credit cards are designed with this in mind. Issuers often consider your enrollment status and may not check your credit score at all.

However, because you have less credit history, you might face higher APRs and lower credit limits than you would with a standard card. These trade-offs are one reason it’s important to use a student card responsibly.

Sources: Chase, Experian, Forbes Advisor

How student cards help build credit

Using a student credit card responsibly can help you build a positive credit history. Your payment history and the amount you owe are major factors in your credit scores. When you make on-time payments and keep your balances low, you demonstrate to future lenders that you can manage credit.

Many student cards come with tools and tips to help you understand how credit works, which can be especially valuable when you’re just starting out.

Sources: Experian, Forbes Advisor

Typical examples of student credit cards and their benefits

Several major issuers offer student credit cards. Chase and Sallie Mae, for example, provide cards that may include rewards and educational resources. Forbes Advisor highlights various student cards with benefits like no annual fee and the opportunity to build credit.

As you compare options, look for a card that fits your spending and offers the support you need as a first-time cardholder.

Sources: Chase, Sallie Mae, Forbes Advisor