Student loan debt for many college students has remained a major problem and as a result there are concerns that some parents have when their student may look into getting a student credit card, or there are some general concerns that these young men and women may simply not be equipped to handle this type of card despite the fact that there are ways that students may still acquire this particular type of unsecured line of credit. Yet, there are also some officials who feel that students can benefit from an unsecured credit card, as student credit cards may still be available to men and women under 21, but there are requirements that have to be met unless a student is able to provide a cosigner that will allow them access to this card.
However, questions remain as to how students do benefit from these credit cards since there is still a danger of acquiring a great deal of debt despite the fact that student credit cards have remained at a relatively affordable level over the past few weeks and, with proper use of these credit cards, keeping debt low and interest rate costs at a minimum can be helpful in the long run. Many student credit cards are currently averaging rates of around 13.99% to 21.99%, but depending on a student’s situation, income, or cosigner this will obviously vary and may factor into the student’s decision to use their card in certain ways.
There are parents who will cosign a student credit card simply as a way for their child to have access to this unsecured credit in case of an emergency or to make certain purchases like food and school supplies, but students who are under 21 are likely to have more trouble if they are looking into these types of cards. Yet, students who can prove that they have sufficient income are usually in a position where rules that have stemmed from the CARD Act will not prevent them from getting an unsecured student credit card.
However we have seen some parents turn to secured lines of credit as a way to offer access to a credit card for their students, but financial officials often caution both students and parents to make sure they understand the responsibility that comes with these cards, past problems that may have arisen, and review their reasons for getting a credit card. In some instances, students have used these cards as a way to begin establishing a credit history, which may be helpful after graduation when it comes to either purchases or agreements that may require a credit check, like renting an apartment or even buying a home, but the debate over the necessity of a student credit card goes back to student loan debt as well.
Unsecured student credit cards have, in the past, been a major stumbling block simply because they have allowed students to acquire a great deal of debt, and since many graduates are having problems with student loans at the present time, compiling credit card debt on top of this financial problem will only make matters worse. While there are students who have responsibly used these student credit cards in the past, and there are still ways that students can access these credit cards, advisers have pointed out that a great deal of financial responsibility must be exercised by these young cardholders if they are to avoid financial setbacks early in life from using these types of cards.