Pros and Cons of Secured Student Credit Cards

August 23rd, 2011 by admin

Many college, and even high school, students have a need for carrying a credit card. Often, however, these students are not yet financially responsible for themselves and still rely on their parents to help take care of their financial responsibilities. Therefore, secured student credit cards may be a great option for parents with children who are still in school. Nonetheless, the pros and cons of secured student credit cards need to weighed in order to determine if they are the right choice for you.

Pro: Secured Student Credit Cards Allow You to Monitor Spending

Secured credit cards are different from traditional credit cards in that you put funds on the credit card ahead of time. Therefore, the only money that is spent with the card is the money that is put on to it. In other words, a line of credit is not extended. Therefore, you don’t have to worry about your child creating a humongous debt that you have to pay for.

In addition to preventing your child from going into debt, a secured student credit card also allows you to set your child up with an allowance. You can determine how much money you want to give your child to spend each month and you deposit the money onto the card. Depositing money onto these cards is easy. You can set it up so that a portion of your check is deposited onto the credit card each payday. Or, you can send money to the credit card company or deposit the money at select locations. This makes it much easier to get money to your child quickly if needed.

Con: Secured Student Credit Cards have a Number of Associated Fees

Although secured student credit cards allow you to monitor your child’s spending habits, there are a number of fees associated with these guards. Generally, there is a fee to set the account up in the first place. Often, there are also annual fees and even monthly fees. In addition, each time you deposit money onto the card, you are usually assessed a small fee. All of these fees add up and can make the student credit card quite costly. Of course, these costs are still less then paying late fees or paying a large debt incurred with a line of credit.

Pro: Secured Student Credit Cards Provide Freedom and Flexibility

One of the best pros of credit cards for college students or high school students is that they allow your child to have the freedom and flexibility that is part of being a credit card holder. These cards do not look any different from traditional credit cards and are accepted at all of the same places. Therefore, your child can use the secured student credit card to purchases necessary items without having to ask you for it or making you have to go out and buy the item.

This is particularly helpful for college students when it comes to purchasing books and other school supplies, as the college may be located pretty far away from home. This makes it highly impractical for you to come to the school to make purchases for your child. Similarly, sending checks can take too long and can make your college student late in purchasing items he or she needs for school.

Pro: Secured Student Credit Cards Teach your Child Financial Responsibility

One of the best perks of a secured student credit card is that it starts your child down the road of financial responsibility. When you deposit money onto the card, your child has to learn how to responsibly use the money provided. In addition, most secured student credit cards report to credit bureaus, and the report will be in your child’s name. This helps to build a credit history for your child, which will make it easier for him or her to acquire loans or other credit cards in the future. Before applying for a card, however, make sure it does report to these bureaus in order to receive this added benefit.

For more information on student credit cards, Kim Stevens recommends that you visit CreditCardAssist.com.

How easy are student credit cards to get? Do u have to have a job?

Answer
First off, dont listen to anybody that says “dont get a credit card” In todays society it is crucial to have one so you can have a good FICO. And how will you buy a home without a line of credit?

Back to your question, my first credit card was with Credit One
www.creditonebank.com (Im pretty sure thats the URL)
I was just graduating high school and I didnt even have a job. They gave me a card with a $200 credit line. When you’ve never had established credit its harder than hell to apply. Try Credit One. I hope it works for you

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Low Interest Credit Card the Pros and Cons of Owning a Low Intrest Credit Card

May 11th, 2011 by admin

Are low interest credit card offers really low?

Yes, all major banks have a few credit cards for people in the prime credit market. These credit cards come with very low to 0% APR. Typically they offer somewhere between 5% APR to 0 % APR for an introductory period. The introductory period ranges from three months to a year. After the introductory period, the interest rate jumps to the current prime rate. You can benefit from a low interest offer by paying a low interest rate for the entire introductory period and save on money. For people using 0% APR credit cards, the credit extended is completely free and you can split a large purchase over a few months without paying any interest fees.

How do you use a low interest credit card?

Low interest credit cards typically come with high balance transfer rates and fees or interest rates higher than the prime rate after the introductory period. Cash withdrawals may also have higher fees. In short, you have to read the terms and conditions pretty carefully. Check for all the fees and future interest rates before signing up. To make the best use of a low interest credit card, you should make large purchases using it and pay off the balance during the introductory period. Yes, you might end up paying a small interest rate but it would be better than taking a store credit for a high interest rate. If you have a 0% INTEREST offer, then you paying nothing for the entire introductory period. Using your low interest credit card smartly during the introductory period can definitely help you to save some money on your large purchases.

0% APR balance transfer rates for low interest credit cards!

Another offer that pretty popular is the 0% APR balance transfer rates. Typically they are standalone offers but occasionally you will find them tagged along with the low interest credit cards. In such cases, you can use move existing high interest balances from other credit cards to the low interest credit card with 0% balance transfer rates and save on balance transfer rates. This will help you pay off your debt quickly and also help you save some money. There has to be a catch to a sweet deal like this, its the high balance transfer fees and high interest rates after the introductory period. Please check these fees and rates to confirm if it would be financially viable to move your debt from other cards on to a low interest credit card with 0% balance transfer rates.

What are the conditions to maintain low interest?

Though the introductory rate might extend for a period of 3 months to a year, the interest rate could be hiked up to a rate much higher than the prime rate during this period. This is typically done if you miss out on any monthly payment or if you exceed your credit limit. To use the benefits of the low interest credit card to the maximum, don’t let any of the above situations occur.

Pros and Cons for switching credit cards?

To take advantage of the low interest credit cards many people switch credit cards rolling over their balances to the new ones in order to keep their interest rates low. This will definitely save you some money and work in your benefit. However switching credit cards might be a long process and frequent switching might reflect badly on your credit report. Typically you should keep some long standing accounts with prime or low interest rates after the introductory period while you switch other credit cards.

Rakesh Nair is an financial expert working in the finance industry for many years. He writes artciles for various topics related to the finance industry. His articles for credit card offers like low interest credit cards are published on many reputed sites.

Should they redefine the definition for “credit card”?

With more people sinking themselves into debt by using credit cards as a extension of their income, it seems that most people really do not understand what a credit card is, or how it can impact their overall finances. Seeing society is in the norm of redefining terminology of so many words (eg. family room = great room), how about changing the word “credit card” to “temporary loan cards” or something that indicates the use of these cards are not just an impact against your credit score. I really think people do not fully understand what the term means or how to use a credit card.

Answer
I don’t mean to sound harsh but I have had credit cards for over 35-years and never had a problem because I took the time to read and understand the terms and conditions.

Plus I always pay my cards off in full every month so I can collect the cash back rewards, never pay interest or fee’s.

I make several hundred dollars a year doing this and I don’t in the least bit feel sorry for people that are not smart enough to do the same.

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Pros And Cons Of Student Credit Cards

April 26th, 2011 by admin

Students usually find it difficult to acquire the regular credit cards since more often than not they are required to be cosigned by guardians. No doubt, this step is convenient for the guardians but at the same time it creates hurdles for the students. However, with prepaid student credit cards life has become relatively easier for students, who need to have a little cash to spend.

These student credit cards are collecting fame because they do not require students to get them cosigned by the parents. This helps them taste the feeling of independence. However, prepaid credit cards are used in a different manner than the regular credit cards hence you have to make sure that you understand about the cards, before you decide to use them.

The student cards are such credit cards where you have to put in your own specific amount of money, and later will be spending only what you have put in. Canadian student credit cards are unlike Canadian regular credit cards as these prepaid credit cards are not meant for using cash on loan rather it allows you to spend as much as you have put money on it. For example, you have put $300 on your prepaid credit card, now this means that the card is only $300 worth so you have got to use only this amount. So, this means that you only get to use the money that you earlier on preserved on your prepaid credit card and cannot use it like the usual credit cards. Once you have used the entire amount you initially deposited on it; you need to refill your card in order to use it again.

There are several benefits of such student credit cards. The predominant one is that you are saved of debts owing to these prepaid student credit cards. In addition, you can deposit as less an amount of money as $75 on these credit cards.  This has made really easy for the students who usually possess less amount of money to put on the credit cards.

Moreover, another advantage of these types of credit cards is that they aid the students in establishing good credit history. So, all those Canadian students who are serious about acquiring good credit scoring, you had better go for a prepaid credit card. You can easily get such credit cards without having to brood over your previous credit scoring or low finances. However, with the usage of these types of cards your good credit score will surely be reported to Equifax Canada and TransUnion.

Apart from this, these credit cards are a great way to master the art of money handling. As you will be depositing money on these cards, so you will learn to be careful about its usage as well. Moreover, the usage of these prepaid credit cards will make you responsible regarding money matters. These credit cards are no wonder, best for taking care of your routine financial issues plus unlike cash, carrying these cards is extremely convenient. But, you have to be 18 years old and should be a Canadian citizen in order to avail the services of such credit cards in Canada. 

I like to write about finance, credit, debt, banking and loans.

What’s the advantage of getting a student credit card as compared to a regular credit card?

Besides the fact that a student card is easier to get without a credit history.

Answer
There really isn’t any advantage, especially with the new laws that people under 21 must prove sufficient income to qualify for a credit card or have a parent co-sign. It is no longer easier to get student cards.

Student cards tend to have lower limits. But otherwise, they’re pretty much the same as regular cards.

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