Student Credit Card Vs. A Regular One

By Author: Danny Aaron
Total Articles: 67
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If you are a student or about to become one and might be thinking of taking out a credit card due to the reason of not working whilst studying, can be a recipe for disaster. If managed correctly and choosing the right package, a credit card could help ease your financial troubles whilst you are busy with your study commitments without getting you into huge credit card debt.

The features and benefits

The benefits of having a credit card are that do not have to spend the money you have, and in the case of a student that would be very little, you can spread what you buy over a certain period of time making it easier for you to survive as a student. You as a student might now think: "Would I really qualify for a credit card?" Obviously there are terms and conditions but no fine print, the main thing is that institutions would be happy to offer you a credit card so that you can build a good reputation with your credit history, in turn, making you a candidate for future loans. Also student credit cards offer lower rates with certain products or services.

Why do banks offer these cards?

Banks look to ...
... your future, so they offer cards even though they know you have no regular income the banks are still looking out for your future. South Africans who have a degree earn on average between 2.5 and four times more than those who do not complete schooling. Degree-holders are also three times more likely to get a job - in a country where more than one in four people are unemployed. Financial institutions want to gain your loyalty and trust so that you will continue to use them for financial means remembering they helped you when you really needed them.

Are there disadvantages?

Of course there are disadvantages. If you do not pay your balance or meet your agreed monthly agreement you can quickly create debt for yourself as with any other credit card. If you budget correctly and do not over exceed your means then the disadvantages are virtually non-existent.

What are the alternatives?

Making this decision is a huge commitment and you need to be absolutely sure you can deal with the responsibility. If you think this might not be the option for you there are other options. The one option is of course having a part time job and applying for a normal credit card that would mean however that you won't qualify for the lower rates and student benefits. Also having a part time job is a bit unstable and you wouldn't be able to work over exam time thus not providing you with a salary. Another alternative would be to watch how you spend your money. Try to cut down on luxuries and coffee at the student coffee shop everyday on the hour every hour. Some students are lucky enough to have their parents pay for unforeseen expenses but if you aren't one of those lucky ones, replacing you breaks would mean replacing them tomorrow and in this case a credit card would be your savior.
Danny Aaron manages the website http://www.creditcardsandloans.co.za, a website devoted to offering the best personal loan information for consumers in South Africa.