Student Credit Card Or Prepaid Debit Which One Is Best

Student credit cards come in​ a​ variety of​ forms .​
But,​ there are two primary forms in​ which a​ student credit card can be found .​
the​ first is​ an​ unsecured student credit card while the​ other is​ a​ prepaid debit card .​
Understanding the​ differences and the​ pros and cons of​ each will help you​ to​ better determine which is​ best for you.

The Unsecured Student Credit Card
An unsecured student credit card is​ like a​ traditional credit card .​
With this type of​ student credit card,​ the​ college student (or high school student,​ as​ the​ case may be) receives a​ line of​ credit .​

Typically,​ student credit cards keep low lines of​ credit of​ about $500 to​ $1,​000 .​
This is​ partly because those applying for student credit cards typically have very little credit history and do not qualify for higher credit limits .​
the​ lower limit is​ also in​ place in​ order to​ help prevent the​ college student from accruing an​ insurmountable debt .​

Not all credit cards for college students have such a​ low credit limit .​
So,​ if​ you​ require a​ student credit card with a​ larger limit,​ you​ might want to​ shop around .​
Similarly,​ if​ you​ want the​ restriction of​ a​ small credit limit in​ order to​ keep yourself under control when it​ comes to​ spending,​ be sure to​ seek a​ student credit card with a​ low credit limit.

The Student Prepaid Debit Card
A student prepaid debit card is​ a​ card that looks like a​ credit card and is​ accepted everywhere a​ credit card is​ accepted,​ but has one major difference: a​ line of​ credit is​ not extended to​ the​ cardholder .​
in​ order to​ make purchases with a​ student prepaid debit card,​ money needs to​ be placed on​ the​ card first .​
This money can come from a​ variety of​ sources .​
the​ student can place the​ funds on​ the​ card him or​ herself .​
Or,​ the​ student's parents can choose to​ add money to​ the​ card .​
in​ fact,​ parents can generally set it​ up so a​ portion of​ their checks from work is​ added to​ the​ debit card each pay period.

Pros and Cons of​ Student Credit Cards
Student credit cards can go a​ long way in​ helping to​ establish a​ student's credit history .​
in​ addition,​ a​ student who does not have money to​ pay up front can certainly benefit from being able to​ take out small loans with the​ credit card in​ order to​ make purchases .​

Another perk is​ the​ fact that the​ student doesn't have to​ wait for money to​ be added to​ the​ card before using it .​
So long as​ there is​ credit available on​ the​ card,​ the​ student can spend as​ much as​ he or​ she wants .​

On the​ other hand,​ a​ student credit card increases the​ chances of​ creating a​ poor credit history .​
If the​ student accumulates a​ debt he or​ she is​ unable to​ pay,​ or​ if​ the​ student is​ late making monthly payments,​ it​ can reflect poorly on​ the​ credit reports .​

In​ addition,​ many students are already starting their adult lives in​ debt as​ they pay off college loans .​
Adding more debt from a​ credit card can be overwhelming and seem impossible to​ overcome.

Pros and Cons of​ a​ Student Prepaid Debit Card
A student prepaid debit card makes it​ easier for a​ student's parents to​ keep track of​ college expenses and to​ monitor the​ student's spending .​

in​ addition,​ there is​ no risk of​ destroying a​ credit history that has yet to​ be created because the​ student cannot spend more than what is​ placed on​ the​ student prepaid credit card .​

Many of​ these cards also report to​ credit bureaus,​ which helps in​ building a​ positive credit history.
Unfortunately,​ prepaid credit cards generally have many more fees than credit cards for college students .​

In​ fact,​ there usually are no fees associated with credit cards .​
Debit cards,​ on​ the​ other hand,​ often have an​ application fee and an​ annual fee .​
There are also fees added every time more money is​ placed on​ the​ card .​
All of​ these fees can easily add up to​ hundreds of​ dollars each year .​

When it​ comes to​ choosing which is​ right for you,​ it​ is​ really necessary to​ evaluate your own needs and spending habits.
Student Credit Card Or Prepaid Debit Which One Is Best Student Credit Card Or Prepaid Debit Which One Is Best Reviewed by Henda Yesti on November 16, 2018 Rating: 5

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