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Credit cards for students and teens


More and more teens and college students have credit cards. Like the population at-large some have good deals, some don't.

Card companies target both groups because they are a fast-growing segment of the population and they have money to spend. So it's no surprise when a 16-year-old high schooler or a college freshman receives piles of offers.



If you're a college student, or the parent of a college student, can help you find the best credit card deals.

You'll see rates that are generally higher than normal cards. Look carefully, because while cards are easy to get the card companies commonly offer heftier fees and interest rates, and smaller credit limits, with these cards.

Which brings up another golden rule: Experts in debt and credit management say emphatically that students should use the cards for emergencies (pizza is not an emergency). Otherwise they're paying a high premium for everyday purchases, running the risk of damaged credit and learning some bad credit habits at an early age.

Consider voluntary limits
Consider putting a voluntary limit of less than the card company will allow -- after all, if the card is used for emergencies only you don't need all those thousands of credit dollars out there tempting you.

If a young person has a credit history and can qualify for a regular credit card, it may work out to be a better deal. (But pizza is still not an emergency.)

All students and teens should remember that a credit card is a stepping stone to a solid credit history -- something of major importance to their futures. Misused, it can add a stain on their credit records that will take years to erase.

Secured cards are another option for teens and students. Banks commonly offers these products, cards where the card-holder puts money in the bank as security. That money guarantees the card issuer will be paid if the card-holder fails to pay the bills. The credit limit is determined by how much is secured in the bank as collateral.

There are also cards available where parents can link a child's card to their accounts, or where they can keep refilling the teen's or student's accounts as they go along. It's a way to keep up with what's going on, limit spending but still provide the freedom and convenience of a card.

Parents also need to be careful in case teens apply and receive credit cards without the parents' knowledge. It's not supposed to happen to anyone under 18, but there is ample anecdotal evidence of people far younger filling out forms and getting their cards.