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3 Credit Cards College Students Should Consider

By U.S. News & World Report

Numerous surveys have shown that many millennials just don’t want them, with most opting for debit cards in the wake of an apocalyptic job market and crushing student loan debt. For those who do want them, credit cards just aren’t always easy to come by. The Credit CARD Act of 2009 pulled the plug on banks advertising on campus — no more free pizzas or T-shirts just for signing up for a card — and also require anyone under 21 to either have a co-signer or show proof of income before they can even get a card.

If you are able to get a student credit card, there is good news, however: Your card’s rates, rewards and other perks are probably better than what college students could get in years past.

That’s the news from a new survey from CreditCards.com, in which we examined 11 of the most popular student credit cards on the market today.

We found that the average APR on a student card is about 13 percent today, compared to 16 percent in January 2008 — just before the arrival of the Credit CARD Act — and none of the cards reviewed have an annual fee. We also found eight of those 11 cards offer rewards to their customers, five offer cash bonuses and nearly all offer some sort of financial tools designed to help college students manage their credit more effectively.

Yet students should still adjust their expectations. The reality is that the best deals go to borrowers with the best credit. That means you shouldn’t expect to get a 50,000-mile sign-up bonus, 10 percent APR or $5,000 credit limit on the first credit card you receive. Keep in mind student cards are meant to be stepping stones — cards you use wisely for a while to build your credit before graduating to cards with better terms and more lucrative rewards.

All that said, here’s a look at some of the best student credit cards on the market right now.

Discover it Chrome for Students

APR: 12.99 to 21.99 percent

Annual fee: None

Top perks: “Good grades rewards,” free FICO scores, double cash back at the end of your first year, no late fee on your first late payment

This is my top recommendation among student credit cards. Its APR range is typical for a student card. It has no annual fee, no overlimit fee, no foreign transaction fee, no late fee on your first late payment and paying late won’t raise your APR. It offers a 0 percent APR on purchases for the first six months. You get 2 percent cash back on up $1,000 in purchases at gas stations and restaurants each quarter and 1 percent on everything else, so there’s no need to worry about rotating category sign-ups. However, the extras are what makes this card stand out.

This card offers $20 cash back each school year — for up to the next five years — if your grade point average is 3.0 or higher. Obviously, that’s not going to change your life, but getting rewarded for something you’re already going to do anyway is always a wise move. The bigger bonus comes at the end of your first year with the card. Discover will double all the cash back you’ve earned during that year automatically, which can always be used to pay down any balances.

Add in the fact that it comes with a free FICO score, payment reminders via text alert and is armed with a Freeze It switch that lets you make the card unusable temporarily if it goes missing, and you’ve got my top recommendation among student credit cards.

BankAmericard Cash Rewards Credit Card for Students

APR: 12.99 to 22.99 percent

Annual fee: None

Top perks: $100 sign-up bonus when you spend $500 in first 90 days, 3 percent cash back on gas purchases and 2 percent on groceries, EMV chip, 0 percent APR on purchases for first 12 months

A sizable sign-up bonus — available only if you apply online — makes this a hard card to ignore, but it is not the only thing the card has going for it.

The card’s cash back offer on gas and groceries is strong, and it’s also simpler to follow than a card that features rotating cash-back categories. In addition, you earn a 10 percent bonus every time you redeem your cash back into a Bank of America checking or savings account. If you’re already a Bank of America customer, that can be a nice perk.

Finally, the card offers 0 percent interest on all purchases for the first 12 months, twice as long as what the aforementioned Discover card offers.

Another option: A secured card

Students may also want to consider a secured card. These cards allow for a young person to build a credit profile while keeping risk to a minimum for themselves, their parents and even for the bank.

Here’s how it works: You are required to make a deposit into a bank account with the secured card issuer. That amount sets your card’s credit limit. That’s it. Essentially, you are borrowing your own money, but building a credit score at the same time. When you graduate to an unsecured card, the issuer will return your deposit.

I recommend the Capital One Secured MasterCard. There’s no annual fee. The minimum deposit is $200. Your payment history will be reported to the credit bureaus, and you get free access to your credit score.

The Capital One Secured card has an APR of 24.99 percent. That’s a bit higher than the top end of the APR ranges for the other cards mentioned, making it even more important than ever that you pay your balance off each month.

One Credit Card Takeaway

Regardless of the APR, job No. 1 for any cardholder is to pay your balance off at the end of each month and do it on time. If you can’t pay the balance off in full, be absolutely, positively certain that you pay more than the minimum. If you don’t do that, the math starts to work against you in a big hurry, and the value of any rewards you receive will be nothing compared to the interest you’ll find yourself paying on a monthly basis.

More from U.S. News

Should Your College Kid Get a Credit Card?

How to Decide if a 529 Plan Is Right for You

4 Credit Lessons Every Graduate Must Know

3 Credit Cards College Students Should Consider originally appeared on usnews.com

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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