Student credit card opportunities, in the past, were available all over college campuses and, for the most part, students were able to get access to credit without much effort. Yet, changes in credit card laws through the Obama CARD Act stopped credit card companies from offering these types of cards to individuals under the age of 21, unless a parent would cosign the credit card application.
However, some students wish to build a credit history while in school and have sought ways to do so through various credit card opportunities. Yet, some parents have also found that finding opportunities for their students, concerning cards, has been affected because of changes in credit card lending rules.
In both of these situations, students and parents have found various credit card lending opportunities which have allowed them the access to credit or cash that some students may need.
Students who simply need a card for college often turn to debit card accounts, which may offer special opportunities for students who are entering college. Debit card opportunities for students do offer some concern for parents as there can be overdrafts which are incurred if the cardholder is not careful with their finances. However, the CARD Act requires that banks allow customers to opt out of the overdraft protection clause for their card, which means that if a debit card account has a balance of zero the cardholder will not be able to continue to use the card and thus avoid overdraft fees.
However, some parents who want their students to build a better credit history may find either a secured credit card opportunity or authorize their child to use their card. While both options have been popular in the past, some individuals who are attempting to build a better credit score while in college are doing so simply because it may make their financial life a bit easier once they graduate.
Obviously, parents who, again, authorize their child to use their card can set limits, but there are also secured credit card opportunities that can help students with their credit needs. Secured credit cards, which can be used to repair a bad credit score, can also be used by individuals, like college students, who may have little or no credit history and may not qualify for an affordable unsecured credit card.
While there are various ways which college students can gain access to credit, many financial advisers warn against doing so without forethought. Again, unsecured cards and secured credit card opportunities are available, as well as debit card accounts for simple access to funds for college, but advisers warn against providing college students opportunities to use credit cards if they are unable to practice responsible financial habits.
As with adults, if proper credit card practices are not used, an individual in college could do a great deal of damage to their credit score, which would obviously set them back in their financial life after they graduate school.