Choosing the Best Credit Card for College Students

It’s about that time of year again: college students are getting all kind of credit card offers, all claiming to be the best credit card for students. A number of years ago, creditors realized that they had an untapped market on hand: students who needed to build up their credit rating while they were going to school so that they could do useful things like get a car or home loan after graduation–but couldn’t do it because there were no credit cards available to them. An entire subset evolved and now every major creditor and no few minor ones offer credit cards geared towards students. All of them have a number of things in common, so how do you choose the best one?

What to Look for in the Best Credit Card for College Students:

Students have very different needs in their credit card compared to older adults, wealthy adults, families, and so on. Students have to juggle their credit cards along with other debts. Bear in mind that they will likely be making less money, need different rewards and interest rates structures, and at the end of the day, have a card they can keep on top of so that their credit rating will be strengthened and neither the student nor their co-signer (any student under the age of 21 either has to show proof of steady income or have a co-signer) will find themselves deep in debt with a poor credit rating to show for it.

All this means that even before looking for a new card, it’s important to have a consider and discuss money management, as well as credit card needs and expectations. Make it clear that you only need a small limit (around $1,000 to keep up with sudden expenses or trips home), or a card that will be used to pay for tuition early and then paid off right away using student loans or savings–whichever works best for your circumstances.

Once that’s hashed out, it’s important to look at the features that are important to you or the student in question. Most student credit cards have at least some sort of reward structure–usually points or cash back–which you earn by spending money on things students most often buy, such as groceries, books and gasoline. Get a card that can give you rewards you’ll actually use and if you’re stumped, remember that cash back always spends!

A good example of this is the new Discover IT card for students. It offers you 5% cash back in rotating categories (it changes every three months) with categories including gas, food and entertainment. You also get 1% cash back everywhere else and you can redeem this cash back for a wide range of merchandise or simple money. You can even call your concierge to help you make the most of your cash back rewards. This is the kind of thing any student can use! For more details, please see our full review of the Discover IT card for students.

Fees to Look For

Before getting too excited over vast untapped resources of rewards and the ability to whip a card out to pay for things, it’s important to look at the fees you’ll be paying for the privilege. There are three major things to mind:

  • Annual fee. A student credit card should NOT have an annual fee; it’s just too tricky to manage.
  • Interest Rates. A good student credit card should have as low an APR as possible without getting rid of the rewards you want. You should also take a look at introductory rates and periods to see if you can save some money. For example, the Discover IT has an intro APR of 0% for six months on purchases-perfect for paying for tuition or books. Keep in mind that no student credit card is going to have an incredibly low APR, but one that is between roughly 12.99% and 18.99% for rewards cards is a pretty good deal.
  • Late Fees. If you are running behind on your payments, most cards will ding you with a late payment or a penalty APR. Read the fine print and carefully compare cards. The Discover IT for example actually forgives the first late payment and doesn’t spike your APR or charge you for it; though after that, watch out!


And the Verdict Is…

So what is the best student credit card? Well, it’s hard to pin it down because it will depend on your circumstances. Many student credit cards are also roughly similar in what they offer and how much they cost, but the Discover IT student credit card is the only one which has things like payment forgiveness plan and a rewards program which is comparable to the regular Discover IT card, making the student version stand out a little above the rest. In our opinion, this makes the Discover IT for students the best one of the bunch. Still, do your research and remember to be responsible with your credit card and you’ll be able to take full advantage of everything one has to offer.


Darryl Van Dyke has over 20 years experience in the finance industry. He is currently the senior editor & contributor at