We researched the selection of student credit cards available, and considered the benefits of each offer. Note that the Credit building 101 section addresses why getting a credit card is important. Here we look just as which offers give the best benefits. First, here are features common to all the major student credit cards:
Common Benefits
- No requirement for a co-signer
- No expectation of you to have a credit history
- No annual fees of any sort
- Online account management systems
- Autopay, which you can set up to automatically pay your credit card bill
Just a note: as we talked about in the section on Credit vs Debit, the APR doesn’t really matter. As long as you pay everything in full and on time , you won’t get charged at the APR for late payments. However, we know it’s impossible to be perfect, so you may want to take lower APR as a slight advantage. Also, when a card offers 0% APR for a period of time, you can take advantage of it carefully, as will be explained below.
Citi® Dividend Platinum Select® Card for College Students (Visa)
Benefits
- 5% cash back for first 6 months on eligible purchases at supermarkets, drugstores, gas stations, convenience stores and utilities, including cable, 2% thereafter
- 1% cash back on all other purchases
- 0% APR on purchases, balance transfers and cash advances for 6 months
- Standard Purchase APR: 18.74%
Recommendation: This is the Visa card with the best benefits. Because it’s Visa, it’s accepted pretty much everywhere that accepts credit cards. 5% cashback for 6 months is high for any credit card, let alone a student card. Once your cashback account reaches $50, you can request a check. The 0% APR for 6 months means that any charges incurred on your Citi Card today, would not accumulate any finance charges till 6 months later - you can pay the minimum balance each month without being charged for the balance you are carrying over for the first 6 months. This could be helpful if you know for sure you’ll have money a few months down the road, but is easy to abuse, so be careful!
Discover Student Card
Benefits
- 5% Cashback Bonus popular categories that change four times a year like travel, apparel, home, gas, restaurants, movies and more
- 5% to 20% Cashback Bonus at top retailers through their online shopping site
- Up to 1% Cashback bonus on all other purchases automatically
- 0% APR on purchases for 6 months
- Standard Purchase APR: 16.99%
Recommendation: This card has similar features to the Citi Card, but has a different cashback structure. The 5% cashback is not limited to 6 months, but rather dependent on you enrolling in a Get More program. Discover gives you in general more cashback bonuses than Citi. Another benefit Discover has over Citi is that your cashback account only has to reach $20 for you to request a check, rather than $50. Discover likewise offers 0% APR on purchases for the first 6 month, and a slightly lower standard purchase APR after the 6 month initial period. However, some sellers that accept Visa will not take Discover.
Cashback > Points/Rewards
The other cards we researched from Chase, Capital One, and Bank of America failed to measure up in terms of features. They lacked the cashback benefits that Citi and Discover offer. Some of them offer awards points that can be redeemed for items, but we think this is strictly inferior to cashback for one main reason - you have limited options of what you can trade in points for. It’s the same reason you’d rather have cash than a gift card to a store. Also, it may be frustrating to find that these reward programs often require a ridiculously high amount of points to trade in for items. In contrast, cashback literally gives you money back, which you can spend at your own discretion.
How to maximize cashback
Discover tends to give you more Cashback than the Citi Visa card in the long run, but is accepted at fewer locations. So one way to maximize your benefits is to get both cards, use Discover where it’s accepted, and use Citi Visa elsewhere. Having two cards will help you avoid maxing out one of them or going over the credit limit (see the tips in Credit building 101 article). It’s pretty common for people to have more than 1 card - just make sure to manage them well!
Apply for Citi (Visa) Dividend Platinum Select Card for College Students here and/or Discover Student Card here.
Or see more student credit cards and apply at Credit-Land.