5 College Credit Card Gimmicks

5 College Credit Card Gimmicks
In case you are going to college, you're probably considering credit cards for college students. Despite popular belief, credit cards usually are not evil incarnate. Actually, building up a credit history while you're still in college can serve you well when you submit a rental application, take out a car loan, or obtain car insurance. But issuers know that you're probably unskilled in choosing a credit card, so be on the lookout for gimmicks, tricks and slick marketing.

1. No co-signer required
Many college student credit cards promote that they do not require a co-signer. Actually, they're the same as almost every other credit card. If you have an income of your own (usually, you do not earn enough as a full-time student to qualify), you do not need a co-signer on any credit card. On the other hand, if you don't have an income, you'll need a co-signer no matter what. Per the Credit CARD Act of 2009, your credit card application will be considered using the earnings of the people liable for the debt. Without having any money, sorry, you'll need a parent on the card along with you.

2. Good GPA discounts
A few rewards cards will give additional points for those who have good grades. Mind you, extra rewards are extra rewards, though the marketing continues to be a bit misleading. For instance, one credit card promises up to 2,000 points twice a year for getting good grades. Even so, you get the entire 2,000 points only when you have a 4.0. If you're human, just like the rest of us, probably the most you can get is 750 points having a GPA between 3.5 and 3.99. The card advertises $20 in rewards, but if you have a 3.9, you'll just get $7.50.

3. Shiny rewards programs
Credit card issuers would like you to get rewards credit cards. Really. Even though it looks like they're giving away money, they'd actually much prefer that you go with a rewards card over one with a low APR. That's because they already know even though you know you should not carry a balance on a rewards card, you most likely will. Don't be drawn in. If you figure that you will have credit card debt, go with a low interest credit card. Although they're not as enticing as pretty rewards programs, you'll spend less in the long run.

4. Prepaid debit cards
Numerous credit card issuers also offer prepaid debit cards as an alternative to personal lines of credit. They'll bill these as a smart way for college students to learn financial responsibility and money management, since you can't spend more money than what's on the card. What they don't tell you, however, is the fact that prepaid debit cards frequently come packed with hidden fees and charges. These may vary from monthly maintenance fees to a charge each and every time you make a transaction, make an ATM withdrawal or look at balance. In case you are intending prepaid, read the fee schedule carefully. Generally, though, you're better off with a regular old checking account with no fees.

5. If you're considering a credit card...
Be extremely careful. Look into the terms and conditions, particularly the facts about the rewards programs. You might see limits on the quantity of benefits you can earn a year, or high rewards rates that only activate once you have spent a certain amount. Understand your spending behavior. Are you going to carry a balance? Then select a low APR card. Can you handle credit in any way? Be honest with yourself: should your parent is co-signing the card, any missed payments by you will pull your parent's credit score down as well. Like most parts of college, credit cards signify newfound independence but additionally significant responsibility.