Janice Lozano
Discover student credit cards are a great way for college students to build their credit history and earn cash-back rewards on purchases. Student credit cards offer lower credit limits, which makes it easier for students to pay back balances. The Discover It Student Cash Back Card, for example, offers a low intro APR and unlimited Cashback Match for new card members. To build credit responsibly, it is important to pay the balance in full each month or at least pay more than the minimum due to avoid interest charges. Students can also set up text alerts to keep track of their spending and avoid exceeding their limit.
| Characteristics | Values |
|---|---|
| Credit Score Requirement | No credit score required |
| Minimum Credit Line | $500 |
| Annual Fee | None |
| Cashback | Unlimited Cashback Match for new cardmembers |
| APR | Low introductory APR |
| Credit History | Reports to the three major credit bureaus |
| Payment Due Date | Indicated on the monthly statement |
| Minimum Payment | Pay more than the minimum due each month |
| Full Payment | Pay the balance in full each month |
| Credit Line Increase | Request after six months of timely payments |
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What You'll Learn
Student card benefits after graduation
Upon graduating, you have a few options for what to do with your student credit card. Firstly, you can continue using your student card as normal. Some card issuers, such as Discover, will automatically upgrade your student card to a regular card, with the same benefits and a removal of the "student" classification. Other card issuers may require you to request an upgrade, which may come with a higher credit limit and better rewards programs.
If you are happy with your student credit card, there is no need to stop using it, especially if your credit score is not great. However, it is important to note that student cards often have lower credit limits and fewer rewards than other cards. Additionally, if your card is older, it may not fit your current financial situation.
If you are considering upgrading your card, it is important to research your options, as some cards with better rewards may come with annual fees. Cancelling a student credit card is also an option, but closing any credit card can negatively impact your credit score. This is because it reduces your overall available credit and shortens your credit history, which accounts for about 15% of your credit score.
Therefore, it may be beneficial to keep your student card open, even if you do not use it often, as it can help build your credit history. To keep the account active without regularly using the card, you can set up a low recurring expense, such as a Netflix subscription, and enable autopay.
Overall, the decision of what to do with your student card after graduation depends on your personal financial situation and goals.
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How to build credit history
The Discover Student credit card is designed for college students who may have little to no credit history. It can be a great way to build your credit history, especially if you're responsible with your usage and payments. Here are some tips on how to build your credit history using a Discover Student credit card:
Make timely payments
Paying your bills on time is crucial for building a positive credit history. Late payments or delinquencies can adversely impact your credit score and may hinder your ability to build credit. Set up automatic payments or activate email and text alerts to ensure you never miss a due date.
Keep credit utilisation low
It is recommended to keep your credit card utilisation, preferably under 30%. This means you should avoid maxing out your card or carrying a high balance. A good strategy is to pay off your balance in full each month to avoid interest charges.
Monitor your account
Regularly check your credit card account activity to detect any unusual or fraudulent charges. This helps you stay on top of your spending and ensures that you're aware of any potential issues. Many credit card companies offer online or mobile app access to monitor your account easily.
Compare student credit cards
Different student credit cards offer varying features, such as cashback rewards, introductory APR offers, and credit limits. Compare these options to find the card that best suits your spending needs and helps you build credit responsibly.
Consider upgrading after graduation
Student credit cards are designed for your college years, but you don't necessarily have to close your account after graduation. Keeping your student credit card open, especially if it's your oldest credit account, can help build a longer credit history. Alternatively, you can upgrade to a regular credit card with improved features, such as a higher credit limit, to suit your post-graduation financial needs.
By following these steps and using your Discover Student credit card responsibly, you can effectively build your credit history and set yourself up for financial success in the future.
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Student card cash back rewards
The Discover it® Student Cash Back Card allows college students to earn cash-back rewards on their purchases. Cardholders can earn 5% cash back on everyday purchases at select stores, including grocery stores, restaurants, and gas stations, up to a quarterly maximum when activated. Additionally, cardholders can earn 1% cash back on all other purchases. At the end of the first year, Discover will match all the cash back earned by new cardholders, with no limit to the amount matched. For example, $50 becomes $100, $100 becomes $200, and so on. These rewards do not expire for the life of the account, and there is no minimum redemption amount.
The Discover it® Student Chrome Card is another option for students to earn cash-back rewards. While the exact reward structure is not specified, Discover states that cardholders will earn cash back on all purchases.
It is important to note that the Discover Student credit cards are designed to help students build their credit history responsibly. Students can build their credit by paying their balance in full and on time each month, avoiding interest charges. Late payments or delinquencies can adversely affect their credit score and ability to build credit.
Discover also offers introductory rewards for new cardholders, such as a low intro APR, which can help students save on interest. However, it is important to note that these offers are only for a limited time, and the standard APR will apply after the introductory period ends.
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Student card interest rates
Student credit cards are a great way to build a credit history and earn rewards on purchases. However, they often come with high-interest rates.
When considering a student credit card, it is essential to understand the Annual Percentage Rate (APR). The APR represents the cost of borrowing money, or, simply, the interest charged on credit card balances that are not paid off immediately. Student credit cards often have introductory offers of 0% APR, but these are limited-time promotions. After the introductory period, the standard APR applies to any remaining balance and new purchases.
The Discover it® Student Cash Back Card has a low introductory APR and no annual fee. This card provides unlimited Cashback Match for new cardmembers, matching the cashback earned in the first year. Discover is also widely accepted nationwide, with a 99% acceptance rate among merchants that take credit cards.
While the Discover it® Student Card offers many benefits, it is important to remember that carrying a balance will result in interest charges. To avoid paying interest, it is advisable to pay off the full balance each month. Late or missed payments can negatively impact your credit score and ability to build credit.
Student credit cards are designed to help students establish a credit history. By using a student card responsibly, making timely payments, and maintaining a consistent payment history, students can build a strong foundation for their financial future.
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Student card payment due dates
Discover Student credit cards are a great way to build your credit history and earn cash-back rewards on purchases. They offer a simple process to start building credit, and responsible use of the card can help establish a credit history that can be beneficial after college.
To build your credit responsibly, it is important to pay your balance in full each month, or at least pay more than the minimum due to avoid interest charges. The due date for your Discover Student Card payment is indicated on your statement and is generally the same day every month. You can also call customer service or log in to your online account to check when your next payment is due.
It is important to make your payments on time to avoid late fees and negative impacts on your credit score. Students with past-due balances may be unable to register for courses or make changes to their existing course schedules. Additionally, late payments can result in late fees, default charges, interest, and possible disenrollment from classes.
To make payments more manageable, some universities offer instalment plans. For example, the UMB Installment Plan allows students to split their account balance into two or three equal monthly instalments. However, prior past-due balances must be paid in full and cannot be included in a current term plan.
It is worth noting that Discover Student credit cards have no annual fee and offer a low introductory APR. This can help students save on interest when making purchases. Overall, by understanding the payment due dates and managing their finances effectively, students can build their credit history and work towards their financial goals.
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Frequently asked questions
The time it takes to pay off your Discover Student Card depends on your balance and how much you can afford to pay each month. You can avoid paying interest by paying your balance in full each month.
You can pay off your Discover Student Card faster by paying more than the minimum monthly payment.
If you can't pay off your Discover Student Card, you may be charged interest on the remaining balance. This could also negatively impact your credit score and ability to build credit.
