Perks: Redeem Scene points for free movies or for discounts at over half a dozen eligible restaurants and stores, including Bier Market and Swiss Chalet. (Note: a movie can be redeemed for 1,250 points.) And save on car rentals; get up to 25% off base rates at eligible Avis and Budget locations.
How to apply for a student credit card
Applying for a student credit card is pretty simple, although there are a few eligibility issues to keep in mind.
- You’ll need to be the age of majority in your province. That’s either 18 (in Alberta, Manitoba, Ontario, Prince Edward Island, Quebec and Saskatchewan) or 19 (in British Columbia, New Brunswick, Newfoundland, Northwest Territories, Nova Scotia, Nunavut and Yukon).
- If you don’t earn an income, you may need to provide proof you receive some form of financial support, such as allowances from your family or a scholarship.
As a new credit card holder, it’s a smart idea to review your options before you apply. Check out what different banks are offering and choose a card that best matches your lifestyle and spending habits. As each application affects your credit score, you want to avoid applying for multiple credit cards. Stick with one card as you learn the ropes and start building your credit history.
Is opening a student credit card a good idea?
The short answer is yes, provided you use your credit card responsibly. Your credit card use is one of the most important things that determines your credit score. Your credit score is like a report card for your finances—the higher your score the better—and it can affect your ability to get a loan, a mortgage, or even to rent an apartment. You’ll want to start building your credit rating as early as possible; being a secondary cardholder on your parents’ card doesn’t count, which is one reason you might want to get your own student credit card. Responsible credit card use is one of the most efficient ways to establish your credit history, build your credit score and prove you can be trusted to manage borrowed money. Beware of overspending, though. Late or unpaid bills can devastate your rating.
Credit card tips for students
You know you need to be responsible in your credit card use—but what, exactly, does that mean? Read on for tips on using your credit card to beef up your credit score, and avoiding any problems.
- Check your payment due dates
You probably know that credit card bills arrive every month, but that doesn’t mean the due date for your payment is on the first day. The date that begins your billing cycle depends on when you are approved for the account, and could be any day of the month. Make note the due date and make sure you pay on time.
- Pay off your balance in full
If you’re going to be responsible with your credit card, that means not spending money you don’t have. Don’t go into debt. The very best practice is to pay off your bill in full, on time, every month. Not only will this boost your credit score, it will also mean you avoid costly interest charges.
- Heed the minimum balance
If you overspend, you still need to pay off some of your balance. Your bill will show a total balance and a minimum balance. You must pay at least the minimum balance, on time and every month, no matter what. Missing payments is one of the worst things you can do for your credit score. Paying only the minimum means that you’re accumulating interest on the unpaid balance. At an average of around 20%, this can add up quickly.
- Don’t overspend
In case we haven’t been clear: Don’t overspend! Credit is borrowed money, and a credit card isn’t a debit card. All the money you charge to your card must be paid back. If you don’t or can’t, you’ll find yourself racking up interest charges in addition to wrecking your credit rating.
- Don’t max out your credit card
Your credit card will have a credit limit; that’s the amount of money you can technically borrow on it. But spending all the way up to your limit—that is, maxing out your card—is reckless. It will be harder to pay off and it actually hurts your credit score. Use your card selectively for smaller purchases, at least initially, and consider using debit for most everything else.
In-Depth: THE BEST CREDIT CARDS BY CATEGORY
For the Best Student Credit Cards ranking we ran the numbers based on $1,000 in monthly spending using Ratehub.ca’s‡ credit card tool while also factoring in sign up bonuses, income qualification requirements and student-oriented rewards. We made the following assumptions on monthly expenditures: grocery spend of $250, gas of $100, restaurants of $100 and bill payments of $62.5, travel of $87.5, entertainment of $112.5, pharmacy purchases of $37.5 and other purchases of $250.