Choosing A Student Credit Card By FederatedCreditCards.Com Copyright © 2008 - 2011

Getting a student credit card can be a bit overwhelming if this is your first experience applying for a credit card. The tips and pointers below will put you on the path towards making informed decisions about which student credit card to choose.

APR - Annual Percentage Rate, that is the rate of interest charged on your card balances per year. In many cases student credit cards have a higher APR than a standard credit card because it's viewed as more risky to loan money to students. APR is not really a simple calculation and if you only make the minimum monthly payment on your credit card balances this can really add up. Student credit cards tend to have introductory offers of 0% APR, however, this usually wears off in as little as six months. The preferable ongoing interest rate should be on the lower end of eleven to nineteen percent which is about average.

Introductory Offers - Most credit cards, including student credit cards, come with attractive introductory offers meant to appeal to their targeted audience. Sometimes it's a 0% APR, or a combination of offers, such as a rewards program, student discounts for books, housing, car leases or purchases, and any number of other offers. While one should take advantage of the less costly and more useful introductory offers, one should also be aware of the ongoing APR, and whether it will shoot up to a rate higher than you're able to pay. Other benefits are often offered as well, --if there are membership fees, only choose the programs that best suit your needs, and will be the most useful.

Penalty Fees & Default Rates - Penalty fees are just what they sound like, --if a card owner defaults on a payment, leaves a balance unpaid for a long amount of time, or exceeds the credit line, penalty fees may be deducted from your bank account, or from your credit line. The default rate is like a penalty fee, --if a payment is not paid in full or missed, the card issuer may adjust your APR to a higher rate, making the annual interest more costly. Ask your student credit card issuer what are the triggers for the default rate to rise.

The bottom line here --look for a student cards with out an excessively high APR, make payments on time, always try to pay more than the minimum payment to reduce debt and interest charges.

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