Managing finances as a student can be challenging, but having the right credit card can make a big difference. Student credit cards offer various perks, including cashback and rewards, which can help students save money while building their credit history. This article explores the best student credit cards that provide cashback and rewards, helping students make informed decisions about their financial future.
Why Students Need a Credit Card
A student credit card is an excellent financial tool that helps young adults learn responsible spending habits while also providing financial flexibility. Unlike regular credit cards, student credit cards are designed specifically for young adults who may have limited credit history. They often come with lower credit limits and fewer requirements, making them accessible to students.
Some key benefits of having a student credit card include:
- Building Credit History: Using a credit card responsibly helps establish a strong credit score, which is crucial for future loans, renting an apartment, or even landing a job.
- Emergency Fund: A credit card can serve as an emergency financial backup when unexpected expenses arise.
- Rewards & Cashback: Many student credit cards offer cashback, rewards, and perks such as discounts on travel, dining, and shopping.
- Learning Financial Responsibility: With a credit card, students can practice budgeting, tracking expenses, and making timely payments.
What to Look for in a Student Credit Card
Choosing the right student credit card requires understanding its features and benefits. Here are some important factors to consider:
Interest Rates and Fees
Most student credit cards have competitive interest rates, but it’s essential to compare Annual Percentage Rates (APR) before selecting one. Some credit cards also waive annual fees, making them cost-effective for students on a budget.
Rewards and Cashback Programs
Many student credit cards offer cashback or rewards on purchases. Some cards provide extra rewards on categories like groceries, dining, and entertainment. Selecting a card that aligns with personal spending habits can maximize savings.
Credit Limit
A student credit card generally comes with a lower credit limit, which helps prevent overspending. However, responsible usage can lead to a higher credit limit over time.
Introductory Offers
Some student credit cards offer welcome bonuses, 0% APR introductory periods, or extra cashback during the first few months. These perks can be beneficial for students looking to save money on initial expenses.
Late Payment Fees & Penalties
Understanding the penalties for late payments is crucial. Many student credit cards offer grace periods, but late payments can lead to additional fees and negatively impact credit scores.
Best Student Credit Cards with Cashback & Rewards
1. Discover it® Student Cash Back
One of the most popular student credit cards, the Discover it® Student Cash Back, offers generous cashback rewards and no annual fee.
Key Features:
- 5% cashback on rotating categories such as gas stations, grocery stores, restaurants, and online shopping (up to a quarterly maximum, then 1%).
- 1% unlimited cashback on all other purchases.
- Cashback Match: Discover matches all cashback earned in the first year.
- No annual fee.
- No penalty APR for the first late payment.
This card is ideal for students who want high cashback rates in popular spending categories.
2. Chase Freedom® Student Credit Card
The Chase Freedom® Student Credit Card is an excellent choice for students looking for a straightforward cashback program and credit-building opportunities.
Key Features:
- 1% unlimited cashback on all purchases.
- $50 bonus after making the first purchase within three months.
- No annual fee.
- Free credit score tracking through Chase Credit Journey.
- Good standing rewards: $20 credit per year for maintaining a good credit record (for up to five years).
This card is perfect for students who want consistent cashback without worrying about rotating categories.
3. Capital One SavorOne Student Cash Rewards Credit Card
The Capital One SavorOne Student Cash Rewards Credit Card is designed for students who frequently spend on dining, entertainment, and grocery shopping.
Key Features:
- 3% cashback on dining, entertainment, streaming services, and grocery stores.
- 1% cashback on all other purchases.
- No annual fee.
- No foreign transaction fees, making it great for students who travel abroad.
- Potential credit line increases with responsible use.
Students who love dining out and entertainment will benefit greatly from this card’s rewards structure.
4. Bank of America® Customized Cash Rewards for Students
The Bank of America® Customized Cash Rewards for Students card allows users to choose their highest cashback category.
Key Features:
- 3% cashback on a chosen category (e.g., gas, online shopping, dining, travel, drug stores, or home improvement).
- 2% cashback at grocery stores and wholesale clubs.
- 1% unlimited cashback on all other purchases.
- No annual fee.
- Introductory 0% APR for the first 15 billing cycles on purchases and balance transfers.
This card is great for students who want flexibility in choosing their highest cashback category.
5. Deserve® EDU Mastercard for Students
The Deserve® EDU Mastercard for Students is ideal for international students, as it does not require a Social Security Number (SSN) to apply.
Key Features:
- 1% unlimited cashback on all purchases.
- No annual fee.
- No foreign transaction fees.
- Amazon Prime Student membership reimbursement.
This card is highly recommended for international students studying in the U.S.
How to Use a Student Credit Card Responsibly
Owning a credit card comes with responsibilities. Here are some tips for using a student credit card wisely:
- Pay Bills on Time: Always pay at least the minimum amount due to avoid late fees and damage to your credit score.
- Keep Credit Utilization Low: Try not to use more than 30% of your credit limit to maintain a healthy credit score.
- Avoid Unnecessary Debt: Only charge what you can afford to pay off in full each month.
- Monitor Spending: Use mobile apps or online banking to track expenses and stay within budget.
- Take Advantage of Rewards: Maximize cashback and rewards by using the card strategically on eligible purchases.
Conclusion
A student credit card with cashback and rewards is an excellent tool for building credit and managing expenses wisely. By selecting the right card based on spending habits, students can enjoy significant savings and financial benefits. Whether prioritizing high cashback rates, flexible rewards, or low fees, there are plenty of great options available. The key is to use the credit card responsibly, ensuring that it becomes a valuable asset rather than a source of debt.