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            When beginning an education program many of the costs have to be footed upfront which means funds need to be in place.  Studies show nearly half of students won’t receive any sort of scholarship or grant and will have to pay for the entire cost of higher education on their own.  Education loans become the next solution, but sometimes loans either aren’t attainable or don’t cover all the expenses. 
                Realizing the need for additional means of funding higher education, whether it’s a four year degree or an online certification, credit card providers now offer what is known as Student Credit Cards.  A 2005 study from Nellie Mae showed that in 2004 76% of undergraduate students alone obtained a credit card before beginning classes.  The most common items purchased with the credit cards were school supplies.
            If students are going to obtain a credit card to cover schooling it could be highly advantageous to consider a student credit card.  Like any credit card all the terms and conditions must be clearly stated and understood and offers should be compared to make sure you’re getting the best possible contract. 

            There are both positives and negatives to using a student credit card but as long as students understand how to use their new credit line responsibly it can lift some of the financial burden instead of adding to it.

The Terms

            Student credit cards are designed to meet the needs of students specifically and they have worked that into the terms that are offered. No two student credit cards are exactly alike and the terms vary for each individual.  So internalize these items of the contract as points for comparison.

• Interest Rate – Interest rates for student credit cards tends to be higher than other lending methods with the annual percentage rate hovering around 15%.  However, many student credit cards offer low or no interest introductory rates that usually last anywhere from 6-12 months. 
• Annual Fees – Usually student credit card will have no annual fee.  Of the ones that do they tend to be low around $25-$50.
• Customer Service and Protection – If your card is lost or stolen it’s your credit that’s on the line.  It’s extremely important that your provider offer 24/7 service, fraud protection programs, online account management and prompt response to questions.  This factor can save you time and money in the long run.
• Payment Options – Many credit card providers will offer you more than one payment option to choose from.  If not, there are plenty of others that will.  Also be aware of the Grace Period which is the length of time before a purchase has interest added to it.  Typically the grace period is around 25 days.
• Bonuses – these are listed below in the Rewards section.  Interest rate is of course the most important factor when choosing a credit card however, depending on the extras that are offered it could make one card a better deal than another.

The Rewards

            Though a credit card may not be the least expensive option to pay for high education costs it can come with benefits that won’t be found using other methods.

• Building Credit – For a younger student who has limited to no credit this is possibly the greatest benefit of using a student credit card.  It’s an opportunity for students to build their credit score as long as the credit card is used responsibly.
• Programs offered to teach students how to use credit. budget ect.
• Rewards and/or bonuses for good grades and making payments on time
• Rewards and Discounts on school purchases
• Cash back rewards
• Low or No Introductory Interest Rate

Responsible Credit Use

            Like any line of credit, how you use a student credit card will determine how much debt you incur as well as how it will affect your credit score.  There’s a lot of temptation to spend with a credit card but giving yourself a few simple guidelines can help keep spending in check, your balance down and your finances healthy.

• Get a low credit limit – ask for a credit line that’s just enough to cover school expenses so you won’t have the means to keep spending on other unnecessary purchases.
• Co-sign for the Card – By co-signing with a parent or significant other you’ll have an accountability partner to help you use the credit line more responsibly
• Don’t use the card for anything other than school expenses
• Make at least the minimum payment each month, every month
• Understand all terms up front before signing
• Make a Budget – For both the monthly expense of paying off the credit card and for tracking charges that are made
• Educate Yourself – Know how to credit works and how to manage debt as well as your options for making payments and receiving financial guidance
• Do Not go over your credit limit