Should college students have credit cards?

Tuition. Rent. Food. Books. Gas. There’s a lot to handle in college as you build your future. No wonder you’re thinking about getting your first credit card. 

Responsible credit card use can help you budget and build credit. But that doesn’t necessarily mean a student credit card is right for you. It depends on your situation. So here are some pros and cons to think through.

What you’ll learn:

• With responsible use, credit cards can help college students build credit history, be prepared in an emergency and learn how to manage their finances.

• To use credit responsibly, it helps for students to understand things like card terms and conditions, interest rates and potential fees.

• Students might be able to access credit with student or secured credit cards or by becoming an authorized user on the credit card account of a trusted family member or friend.

Here are five advantages of credit cards for college students, if the cards are used responsibly:

When your credit card issuer reports your payments to the credit bureaus, that information will appear on your credit reports. This record of how you’ve managed debt is known as your credit history. Companies may use this information to decide whether to offer you a car loan, an apartment, a mortgage and sometimes even a job. Building a credit history in school means you won’t be starting from scratch when you graduate.

What if your car breaks down or you need to upgrade your laptop or cellphone? Young adults might not have an emergency fund yet. In that case, a credit card could help you deal with an unexpected cost. The Consumer Financial Protection Bureau (CFPB) notes you should be clear with yourself about what represents an emergency.

Having a credit card can help you build healthy financial habits through doing things like budgeting, tracking your expenses and making on-time payments. Whether you’re handling an emergency expense or managing day-to-day spending, having a plan to pay off your credit card is valuable.

Cash back credit cards can help you get the most out of your spending on textbooks, food, gas and rent. And when you’re a student, every little bit helps. It may be worth checking out other kinds of rewards credit cards too, if you’re interested in different perks.

If your cash is stolen, there might not be much you can do about it. But if you report fraudulent charges on your credit card and they’re investigated and verified, many issuers, including Capital One, won’t hold you responsible. And if you’re a Capital One customer, your credit card has a number of security features that may help you detect fraud.

There are lots of good reasons to have a credit card in college. But everyone’s situation is different, and understanding how credit cards work and using them responsibly is important.

If you’re unable to make your credit card payments, it could result in derogatory marks on your credit reports. This can lower your credit scores.

Paying your statement on time every month is only one key to building credit. If you’re able to pay more than the minimum each month, it can help you limit or avoid interest charges on new purchases.

Do you understand how the interest rate works, credit card terms and conditions and common credit card fees? Different transactions might have different rates or fees. For example, a cash advance might not be treated the same as a standard purchase.

You could be tempted to overspend. Making late payments can result in late fees. You’ll be legally responsible for repaying your debt. If you use a credit card responsibly, there’s less to worry about. But remember that negative information could hurt your credit scores.

If you’ve weighed the pros and cons and decided to go for it, you can start thinking about the best student credit card for you. If they’re used responsibly, these options could be a good entry point into the world of credit:

Student credit cards aren’t that different from other credit cards, but they can be more accessible to those with no credit history. They can offer more fraud protection than a debit card. Plus, you can build credit by using a student card responsibly. And that can set you up to be eligible for other cards and loans in the future.

With a secured credit card, you deposit an amount of money that the issuer holds as collateral for the credit line, sometimes known as a security deposit. For example, the Capital One Platinum Secured card has refundable security deposits of $49, $99 or $200 for an initial credit line of $200. Deposit more, and you could raise your credit line as high as $1,000. You can then use the card to make purchases just like you would with other credit cards.

Becoming an authorized user means you’ll get a card linked to a trusted family member’s or friend’s account. While you’ll likely get your own card and can make purchases, the primary cardholder is ultimately responsible for all the charges made on the account. But negative actions like making late payments could affect both of your credit scores.

Getting a credit card in college is an exciting milestone. And if it’s used responsibly, it can be a great way to jump-start your financial future. But before you get a credit card as a college student, you should consider your financial situation and whether you will be able to use it responsibly. 

If you’re looking for a way to build credit and earn rewards while you’re in college, using a student credit card responsibly may be a good option.

• See if you’re pre-approved for a student credit card without harming your credit scores.

• Explore Capital One student rewards credit cards you can use to build credit with responsible use.

• Earn unlimited cash back on food and fun with the Capital One Savor Student card. 

• Earn unlimited 1.5% cash back on every purchase, every day with the Capital One Quicksilver Student card.