Finding a great student credit card can make it easier to manage your money, and even earn you rewards and cash back on your spending. However, getting the perfect card to fit your needs might take a bit of research, as there are many different products out there to consider.
Here we’ll run through some of the points you need to look at when choosing a credit card, along with a few strong options to review and compare. We’ve also thrown in some great tips to help you make the most of your card - and cut the fees you need to pay, too.
Wise is a new and bold finance specialist who aims to make money borderless with their multi-currency account and the linked Mastercard debit card. It could work out to be up to 4 times cheaper for spending abroad, compared to PayPal and banks.
There’s no sign-up or maintenance fees, no foreign transaction fees and you’ll have dozens of currencies at your fingertips.
There won’t be any markup on your foreign exchange rate either - Wise always gives you the mid-market rate on all transactions.
You’ll find more about the card in the article below. If you’re feeling impatient, just click here to take a look and see how it works.
The right card for one person might not be the best pick for the next. It’s worth investing time in reviewing some different card options, to help you find the one which best suits you.
Here are some things to think about when you compare cards:
If you’re about to head off to study abroad, you’ll want to check your card can be used easily wherever you’re headed. For example, MasterCard and Visa tend to have good global acceptance, while Discover cards are less frequently used in some areas of Europe. Luckily the major card providers offer tools to help you check where you can use your card, and find ATMs which will allow you to withdraw cash. Check out Discover’s global acceptance, or find an ATM for MasterCard through the links.
Spending abroad using a US issued credit card can come with extra fees. You’ll want to check out:
- the foreign transaction costs,
- the exchange rate offered,
- and also look out for extra charges such as international ATM fees or cash advance charges.
Get a good overview of the range of fees you might come up against before you choose the right card for your needs.
It’s good to know that** some credit cards come with automatic travel insurance**, which means that you can get extra protection if you book travel tickets using the card. It’s also worth checking out the card issuer’s emergency assistance options. If your card is lost or stolen overseas you’ll need a way to get a new card, and even some quick cash, to pay your way. Some card issuers offer this as a feature, which could offer an extra bit of support when you need it.
In many destinations you’ll be expected to have a chip and PIN enabled card. To make life easier, choose a credit card issuer which will give you one as standard.
A final thought to consider - as well as or instead of getting your own credit card - is to become an authorized user on another card. You may be able to get added to your parent’s card, for example. If they have a premium card type which offers great rewards, this could work out well for you all. However, be aware that the spending of all authorized users can impact your credit history - be responsible with your card or risk poor credit ratings.
The right credit card for your needs will depend on your credit history, spending patterns and personal preferences. It’s worth doing your research as there are many options out there to consider - from cards which reward travel and overseas spending, to products which are open to customers with a limited credit history, and everything in between.
Here are a couple of good picks to get you started:
Bank of America offers several specific student credit card products, including this one which comes with great rewards for regular travelers. If your focus is on getting rewards for your spending this could be the card for you.
- Bonus offer of additional points if you spend $1,000 in the first 90 days your card is open
- Earn 1.5 points for every $1 spent, and redeem whenever you want - no blackout dates to worry about
- No annual fee, and no foreign transaction fee - although you’ll need to check the exchange rates used for currency conversion as there may be a markup applied
- Introductory 0% APR, followed by 17.24%-25.24% depending on your credit score at the point you open the account - this APR will rise to up to 29.99% indefinitely in the event of late payment
Discover offers various student perks including a reward for good grades, cashback and rewards. Get a $20 credit for each year you hit a 3.0 GPA, for up to 5 years as an incentive to hit those books.
- No annual fee
- 1%-5% cashback depending on where you spend, with an opening offer which means Discover will double the cash back you receive in your first year
- Check your credit score every month, and automatically turn the card on and off if you need to secure it
- 0% APR for the first 6 months, followed by 15.24%-24.24% depending on your credit history
- Cash advance fee of $10 or 5% of the advance value
- Balance transfer fee of 3%-5%
One challenge many students face is getting a credit card when they have little to no credit history. Banks may be unwilling to offer a card until you build some evidence that you can use credit responsibly. In this case, a secured credit card - where you pay an initial security deposit prior to using the card - may help you build a credit history, and allow access to other credit options in future.
- No annual fee to pay - just a refundable security deposit of $49-$200 to allow access to credit
- Your credit line could increase as long as you prove you’re able to make regular repayments
- No foreign transaction fees, and 24 hour help if your card is lost or stolen, including access to an emergency cash advance if you need it
- Get travel insurance free if you use your card to buy travel tickets
Depending on your spending habits, a credit card might not be the right option for you. Instead you might consider getting a debit card designed for people living, working or studying abroad, such as the Wise multi-currency MasterCard.
This smart new card is linked to a Wise multi-currency borderless account, which lets you hold money in over 40 different currencies, and access simple currency conversion which uses the mid-market exchange rate. That means you can pay money into your account in dollars, and switch it to the local currency wherever you’re studying, for just a low transparent charge. Then use your card to spend any currency your hold fee free wherever you see the MasterCard logo, or to make withdrawals at local ATMs. You’ll be able to withdraw up to the equivalent of $250 a month for free, with a small fee to pay after that.
You can open a borderless account online in just a few simple steps, and manage your money on the go with a simple to use app. See if you can save time and money with Wise today.
Let’s close with a few final thoughts on making the most of your card abroad - and avoiding unnecessary costs while you study overseas:
- Let your bank know your travel plans and make sure they have the correct contact details for you. If they suspect suspicious activity they need to know how to contact you to check everything is OK - or they may block your card entirely
- Get familiar with the exchange rate used by your card issuer. Compare it with the mid-market rate - the one you’ll find on Google - to check you know how much overseas spending is really costing you
- If you’re asked whether you want to pay in dollars or the local currency, always choose to pay in the local currency. This is an example of Dynamic Currency Conversion - a sneaky way some ATM operators and merchants try to increase fees and offer poor exchange rates
- Choose a chip and PIN card, with no foreign transaction fees, for the most simple - and often cheapest - spending overseas
- Travel with more than one card, ideally across two or more networks, so you have a backup if one card is lost, stolen, or not accepted in your destination
- Avoid credit card cash advances - the fees and interest you pay tend to make this an extremely expensive way of getting your hands on cash
While finding the right student credit card for your needs might feel a little daunting, you’ll be able to get the right product for you with a little research. Think about how you intend to use your card to get the best combination of convenience, low fees, and rewards - and enjoy your time studying abroad without worrying about excessive bank charges.
- BoA - Credit cards for students
- Capital One - Discover it® Student Cash Back
- Capital One - Secured Mastercard®
Sources checked on 13 August 2019
This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.
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