Posted on Wednesday, 11th January 2012 by Erin Jones
As if choosing a college and moving away from home for the first time wasn’t stressful enough, many college students are also faced with the choice of getting their first credit cards and beginning to build their credit histories. Many lenders offer credit cards designed with students in mind and relentlessly push new applications on the new students on campus. While a student credit card can be a wonderful way for a college student to build a credit profile, there are some pitfalls for the unwary that can cost the student a lot of money over the long haul. Here is one of the most important things to look for in a student credit card.
Before signing up for any credit card, it is important to know what the interest rate for the credit card would be. A high interest rate means that you will spend more money for the purchases placed on the credit card, especially if you are not able to pay off the entire balance every month. A credit card with a low interest rate will generally have a rate of less than 10% while a credit card with a high interest rate could be as high as 30%. You should look for the student credit card with the lowest interest rate and the highest credit limit you qualify for.
Some student credit cards offer students an introductory interest rate of 5% or less in order to entice them into signing up for the credit card and using it for general purchases. Unfortunately, after a set period of time, the interest rate increases dramatically and is applied to all future purchases that are made on the credit card. Be sure to read the terms and conditions of the credit card application carefully so that you will know what the interest rate will be during the introductory period and after.
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Tags: Card, Credit Card
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