Should you have a credit card in college?

Should you have a credit card in college?

Should College Students Have a Credit Card?  

Transitioning from high school to college is a major milestone in a teenager’s growth, and it brings many changes. Some of those changes are financially related, and one of the questions that both teens and their parents often ask is whether they should have a credit card in college. Here’s a look at the downsides and upsides of credit card usage during college, and how you can reduce the risk of overspending.

The Downsides of Credit Cards

It’s no secret that credit cards have potential downsides. They require maturity to use them wisely, and everyone knows someone who got into financial trouble as a result of using credit cards recklessly. People who have credit cards and aren’t careful with them could succumb to one or more of these pitfalls:

  • Get into financial trouble quickly if their spending is out of control
  • Pay penalties and high-interest rates that increase their card’s bill
  • Become buried in balances that seem impossible to pay off

While this can happen to anyone, college students may be particularly susceptible to potential dangers because they don’t have the same maturity and experience as older adults.

Of course, a credit card also gives college students more autonomy over their spending. While this may not be a downside for all, it’s easy to make purchases that wouldn’t necessarily pass parent approval. For example, expensive computers, phones, televisions, or vacations can easily be paid for by a credit card but may not be parent approved.

The Upsides of Credit Cards

Despite their potential downsides, credit cards can also have significant upsides for college students. While the following benefits can be true for anyone, they can be especially helpful to college students who often have limited financial resources and short credit histories. With our student Visa credit card, students can: (link goes to:

  • Pay for emergency items (car repairs)
  • Purchase school materials (books, lab supplies, etc.)
  • Begin building their credit history and score

The last item, a student’s credit history, and score will be used to determine many important future financial decisions. Their credit history and score will decide whether they will be able to rent an apartment, lease or finance a car, or take out other loans in the future. Plus, their credit history and score also determine the rate that they will pay on those loans. Employers may even check a student’s credit score before making a hiring decision.

Another option is to apply for a secured credit card. (link to With this type of card, the cardholder offers an upfront sum (for example, $500) that’s held by the financial institution. This amount is the limit for the card and will be used to repay the balance if the cardholder is unable to make payments. The arrangement allows college students to build their credit history while keeping their credit card balance low and manageable.

We’re Here to Help!

Having a credit card in college can provide both students and their parent’s peace of mind. However, it’s a decision that requires careful thought and consideration.

To discuss and learn more about our credit card options, stop by any branch or give us a call at 415-775-5377. (link to )

Courtesy of Stratix

Each individual’s financial situation is unique and readers are encouraged to contact the Credit Union when seeking financial advice on the products and services discussed. This article is for educational purposes only; the authors assume no legal responsibility for the completeness or accuracy of the contents.

Scroll to Top