Credit card 101: Applying for a credit card as a college student

Class is in session! As a college student, do you know the best way to get - and use - a credit card? It's ok if you're new to the world of credit — we're here to help. In this article, we’ll cover:

>>More: Starting to build credit? Freedom Rise™ offers cash back on each purchase.

Benefits of credit cards for college students

A credit card can be a valuable tool for spending and budgeting if you use your card responsibly. Spending recklessly on a credit card can lead to hefty interest charges and may result in your credit score taking a hit.

If you commit to responsible credit behavior, a credit card can offer the following benefits:

 Please note that while Chase has a number of cards that may be suitable for college students, there is not currently a designated Chase student card.

Applying for a credit card as a college student

Apply for a traditional card

Traditional credit cards can have many upsides. Congress aimed to add protections for consumers by enacting the 2009 Credit CARD (Card Accountability, Responsibility and Disclosure) Act.

The act stipulates that people under 21 can only get a credit card if they:

If you can show that you have sufficient income or a trusted co-signer, a traditional credit card may be a good choice for you.

Apply for a secured credit card

A secured card works just like a traditional card when it comes to making purchases. It's the application process that's different: You need to make a deposit that will serve as collateral. Please note that Chase does not offer secured credit cards.

Your secured card's limit will be no larger than this deposit, which may limit your ability to make big purchases with the card. But secured cards may be available to people as young as 18. Since they require collateral, they may have a higher approval rate for those with poor or no credit history. Not all banks or credit card companies offer secured credit cards, so be sure to do research on which cards might be available to you.

Become an authorized user on another person's card

Authorized users are typically a cardholder's family members. But others can become an authorized user on another person's credit card: That person simply has to contact their card issuer and make the request. If it's approved, the user will receive a card in his or her name.

A benefit to becoming an authorized user is that it can help build your credit. Some, but not all, card issuers report authorized users' payment histories to the credit reporting agencies.

Open a joint credit card account

Becoming a joint cardholder is similar to getting added as an authorized user, with one key difference: Every cardholder on a joint account is legally liable for the card debt.

In addition, joint credit card account activity is guaranteed to show up on your credit report. If you find a joint account holder with excellent credit, their credit history may help you to get better terms than you might otherwise be able to. Keep in mind that joint credit card accounts are not commonly offered by banks or credit issuers and you are more likely to find cards that allow you to have authorized users.

Credit card tips for college students

Credit is a powerful financial tool as it may offer purchase protection and the ability to make purchases that you might not be able to afford in cash. Plus, some credit cards offer opportunities to earn cash back or other rewards.

Yet like any tool, credit can be misused. Be smart when using a credit card so you can stay out of financial trouble and maintain a good credit score.

Keep the following in mind to help get the most out of a credit card and maintain your financial health:

Shop around to find a card that fits your needs

There are dozens of different credit cards available to college students. You may find searching through credit cards confusing but you may want to take time to do your research and try to find the best card for you. And be sure you read your top-choice cards' terms and conditions closely before you apply.

Only apply to the card(s) you are confident that you want

Every time you submit a credit card application, the card issuer will order a copy of your credit report. This can temporarily affect your credit score — so you might want to keep your applications to a minimum. Requesting pre-approval for a credit card does not guarantee that the applicant will be approved. However, requesting a pre-approval will not hurt your credit score.

Keep your card spending within your budget

Perhaps the most important credit tip is to stay on top of your spending. When you're making purchases with a credit card swipe, as opposed to paying in cash, it can feel like you're playing with house money. But this can get you into trouble. Instead, treat card spending like paying with cash or a check. In addition, consider using your card issuer's mobile app to track your spending and stay within your budget.

Check your credit report regularly

You are entitled to one free credit report annually from each of the Credit Reporting Agencies (Equifax^®, Experian™ and TransUnion^®). You can order your report from all three CRAs at the same time — or pull a single report every four months. Whichever option you choose, commit to checking your credit report regularly to monitor for any suspicious activity.

Why credit cards could be beneficial to college students

For college students, credit cards offer financial flexibility and a way to build credit. Still, having a credit card is a big responsibility. It's important to treat credit carefully: conduct research to find the card you want, understand how card spending fits into your overall budget and use credit at a level you can afford.

If you make a habit of paying your bills on-time, you could build a strong credit history for your future. When you pay off your entire credit balance every month, you can help prevent accruing interest and use spending to earn cash back or rewards points from credit cards with perks.

Your first lessons in credit can build a foundation that benefits you moving forward. Opening a credit account can help you graduate into the real world with a responsible credit history.