Students and credit cards: is it a good idea?

credit cardStudents and credit cards – most people would immediately think of the two as things that should just not be mixed but is this really the case?

The thought of that ever-increasing student debt is often enough to discourage even the most extravagant spenders. However, if they manage it effectively, all students should be equipped with at least one piece of plastic.

Increase cash flow

Firstly, there’s the desperate need for funds. As a student, it’s unlikely that you’re generating a lot of income as most jobs are part-time and low paid. Unless you have incredibly generous parents you will still need to find the money to put food on the table and pay the bills.

There are a few golden rules to spending on a credit card, particularly for students. Don’t treat it as your own money and always pay it off in full every month to avoid interest charges.

Build credit score

Most students heading to university don’t have any credit history as they have been living with their parents. Now you’re stepping out into the big wide world you will need to utilise credit options to build up your score.

In many cases, you’ll find that you’re ineligible for credit cards because of your absent credit history but some credit cards take this into consideration. For more information on aquacard, a leading credit card provider, you should visit their website or look for customer testimonials and reviews online.

Just by using the credit card regularly and paying it off in full, you will start to prove yourself as a responsible borrower. You don’t have to spend cash you don’t have, simply use the credit card in place of cash and repay the balance immediately.

Planning for the future

As I’ve just mentioned, it’s really important for students to start building their credit history as early as possible. It’s getting harder and harder for young people to get onto the property ladder and access to credit because of the economic climate. If your credit rating is one step above the rest, you’ll jump to the front of the queue.

Whether you want to buy your first home, buy a new car or pay for a wedding, you’ll need to obtain credit (unless you have substantial savings).

If you’re not sure whether a credit card is right for you or more importantly, whether you can be trusted to keep plastic in your wallet, then it is important that you speak to a professional. You should always look to find out more about credit cards for students and evaluate their effectiveness based on what they offer and how this coincides with your personal situation.