Secured Student Credit Cards
What good are secured student credit cards? They're really good when it comes to teaching students how to use credit cards wisely.
Teaching Limits
When your student goes off to college, they are more than likely going to be bombarded with credit card offers, making it all too tempting to get that first card and spend, spend, spend. After all, when you can charge all this great new stuff and you only have to pay $20 a month, why not? That's how an inexperienced college student might see it, and it's just this attitude that's put many students in debt. But credit-savvy parents send their kids off to college with secured student credit cards. The benefit of secured student credit cards is that you or the student can pre-set the limit on the card because it's prepaid. In fact, a secured credit card is similar to a debit card. When you fill out the application, you send in a check for whatever you want the limit to be. The credit card company will deduct a fee for setting up the account, then the rest is available for spending. There are no late fees because your student is spending money that's already been paid into the account. And there are no over-the-limit fees because if the student charges more than what's left on the card, the transaction is simply declined.
And when funds run out on secured student credit cards, they are reloadable (again, for a small fee). You can reload them or the student can reload them. And parents can have the statements sent to them to monitor their student's spending. (Most parents who provide the card and reload it are particularly interested in this feature.)
Where to Get Them
Most banks offer some sort of secured card (for instance, the Bank of America secured credit card) but it might not surprise you to know that most of the bigger credit card companies offer them too. There's a Citibank secured credit card, a Chase secured credit card and a Capital One secured credit card, just to name a few. You can find all kinds of secured credit card offers online. And since secured credit card applications don't come in the mail as often as unsecured offers, you might just have to go online to find one. But that's okay. The important thing to remember is that secured cards teach your child how to use credit cards wisely.
All material copyright © 2008 Secured Card Pick. All rights reserved.
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