Should I get a Credit Card in College?

Today I’m talking about a subject I’ve avoided talking about until now – credit cards.  I’m also talking to an age group I generally don’t aim my posts at, and that’s college aged students. 

I’ll get into why in a minute, but I hope if you’ve asked yourself whether you should own a credit card or not, that today’s post will help you figure out the benefits of a credit card, but also help you be aware of credit card disadvantages. 

So, why have I avoided talking about credit cards? First of all, I always felt that wasn’t a topic I should be talking about, that it should be left to the financial gurus instead of this little stay-at-home mom with no letters next to her name.

However, I’ve decided I am going to finally address the topic of credit cards because sometimes people want to hear from others that they can relate to.  We’ve also have had a track record of being financially responsible with our credit cards and credit in general.  We are enjoying living mortgage-free as proof!

But the other question you may be wondering is why today’s post is geared at college-aged kids.  Well, while I don’t have any college-aged kids yet, we are only a few years away and so we are beginning to think about the college years.  I also remember being faced with managing my finances at that age and really knowing nothing about it.  I do remember how eager I was to try and get a credit card though!

So, let’s get back to the question at hand.

SHOULD I GET A CREDIT CARD IN COLLEGE?

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Honestly, I don’t believe the answer is the same for everyone.

For me, personally, I actually couldn’t qualify for a credit card in college, even a student one.  Now, that was 18 years ago so I am not sure if it is easier or harder to qualify, however looking back, had I qualified for one, I still shouldn’t have gotten one.

Why?

Because I was downright foolish with my money at that age.  I was not frugal, I didn’t really know about budgeting, and I was a spender.

The first thing you should do if you are heading to college and considering a credit card is look at yourself and your spending habits realistically.  You most likely didn’t have many bills, if any before college, but when you did get cash did you spend it all?  Or did you save a good portion of it.  

If your habits have mostly included spending and very little to no saving, I’d hold off from a credit card right now.

The truth of the matter is, it’s not that hard to get through college without a credit card.  However, some people like to start building their credit as soon as they can and that may be the motivation to get a credit card.

I want to reassure you though, you have lots of time to build your credit.  Sometimes there’s this pressure for us to be financially set as soon as we move out of our parents’ house. 

As someone who falls in the perfect credit score category and didn’t have ANY credit when I was a college student and shortly there after, I can tell you there’s plenty of time for improving your credit score.

But, like I said, it’s not a one-size-fits-all when it comes to credit cards and college.  For some people, owning a credit card might be a good option.  When should you own a credit card?

I’d say, you want to check two boxes.  The first is that you are responsible with your finances, and live within your means.

The second would be that you have a job or a way to pay off the credit card when you use it.

If you are not pulling in any income, it’s going to be very tough to pay that credit card off after you used it.

Also, if you are going to have a credit card in college, consider storing it in one of these minimalist style wallets for credit cards.  Why?  Because college life means you will be out and about and the last thing you want to do is lose your credit card and have someone find it and use it and rack up a large credit card bill. 

BUT WHAT ABOUT CREDIT CARD REWARD PROGRAMS?

Okay, so I get it.  So many credit cards have reward programs and you can benefit from it.  However, what good are rewards if you are thousands of dollars in debt because you had a hard time controlling yourself?  

In my humble, stay-at-home, non-educated opinion, I’d say reward points should never be your motivating factor in whether you obtain a credit card or not.  Sure, it might be a factor when you decide WHICH credit card is the best one for you when you are ready for a credit card.  But we should never get our first credit card because we wanted the rewards.

Because you’ll never make enough reward points to make up for the debt you may have thrown yourself in.

BENEFITS OF CREDIT CARDS

Look, I know I’m sounding all negative here, but it’s just because I’ve watched so many people get into trouble and fast when it comes to credit cards.  But I’ve also watched people be responsible with them as well.

So what are some of the benefits?  Well, we know that credit IS needed when we go to purchase things on our own like houses and vehicles.  A credit card will help you build it up.  Basically, bottom line is that there are advantages of credit that will affect purchases the rest of your life.

And while I said that you shouldn’t get a credit card JUST for the points, the points are a nice perk.  

It’s also beneficial to have another way to pay when you are at the store.  There have been times a debit machine is down, or you didn’t have a chance to go to the bank and pull out money, and the credit card can be an extra method of payment in those circumstances.

DO YOU HAVE TO USE A CREDIT CARD EVERY MONTH?

No, you don’t.  It’s a good rule of thumb to make sure you use it every 3 months or so as different credit card companies might deem the card inactive and cancel the card, but that usually doesn’t happen until after three months.  Be sure to check with your credit card company though, to see how long it takes of inactivity on your credit card for them to cancel it.

However, if you are trying to build your credit you may want to make sure you use your credit card every month as this will help.

BE RESPONSIBLE WITH YOUR CARD, AND IF YOU CAN’T, LET IT GO

While I believe credit cards can benefit you, I think it’s better to live without credit cards if you find you can’t manage them.  It’s definitely true that it can be difficult to purchase certain things without a credit card, but it’s not impossible.  You can also get prepaid credit cards as an option as well.  That means you’ve put the money on the card from your bank account, and can often use it exactly like a credit card.

Another option to help you control your spending on a credit card is to keep the limit low.  Our bank continually tries to increase our limit and we keep refusing.  We don’t see any reason we need a 10,000 dollar credit limit on our cards.  

When I got my first credit card the limit was $500 and I was very happy that the limit was so low as I was new to the world of credit cards.  It’s hard to get into too much trouble if you have a low limit.

BOTTOM LINE:  WHATEVER YOU DECIDE IN COLLEGE, DON’T LET A CREDIT CARD GET YOU INTO TROUBLE.

If it has, it may be time to cut it up.  That may seem drastic, but it’s a much easier route than getting so far into debt you can’t get out.