Getting the College Student Credit Cards after the Card Act

Getting the College Student Credit Cards after the Card Act in February

If you wish to get your son or daughter at college away from home their own credit card, you'd better do it before February; the new credit card rules are coming up and they restrict the minimum age to apply for a credit card to over 21. Parents have traditionally been really anxious to get their children started on a credit card as early as possible. They figure that with a credit card, their children will naturally learn to be quite responsible with their money and their credit, and by the time they are out of college, trying to find their fit in the world, they will have years of solid credit history to smooth their way. While this does sound like pretty thoughtful foresight, parents need to think of the whole idea of getting a young college student credit cards, by putting themselves in the state of mind they are in at the time. Often, young people can be quite irresponsible with their money, and with a single default, the whole credit history plan backfires. Have you ever spoken to a college aged kid about credit cards? It is the popular opinion in that age group that credit card funds are the same as cash. It doesn't quite sink in that easily that things spent by credit card have to be paid back, at a monstrous interest rate.

As a part of the whole financial responsibility thing, starting February, they are only letting people over 21 apply for credit cards for themselves. After that, if you want to get a young person in your family her first credit card, you will have to co-sign for it. The psychology behind this is that it will make you nervous to cosign it and take on responsibility, but that the nervousness will help you do a good job talking to them, telling them that for the young college student credit cards are no easy matter. But something tells me that this well-meaning injunction could actually backfire. There is such a thing as an add-on credit card, you know? What if parents too nervous to cosign pick the add-on card instead? This way, young people get to learn even less than before about taking responsibility for what they spend. And of course, there's always such a thing as a secured card that is much less of a hassle. They can put down a deposit with the bank for the credit limit they want, and if they spend long enough paying their bills on time, the bank will upgrade them to a normal unsecured card. There really is no need to make it more difficult for parents to take the responsible route.

Still, for the young college student credit cards of their own are a big deal - a step into adulthood as it were. The college they go to almost always has a credit card preference; if they take the offer, they'll give you a university-branded credit card with a really low interest rateall the better to bait you with. But that rate only stands for a few months, after which it jumps to a really unreasonable 19%. As a college student credit cards should be picked not for what offers they have or what rewards programs they give you; all you need is something that has no annual fee, no application fee, and an interest rate that is no higher than 17%. And oh! yes, make sure that you get a card that reports to the credit bureaus, all three of them. You do want it to reflect on your credit score that you pay everything back on time, don't you?

As long as young person in your family understands that taking cash withdrawals out of the credit card are not cool, that he or she mustn't ever miss a date, and always must pay the balance in full, not in part, everything should be fine.