Credit Cards for Unemployed Students
If you're an unemployed college student, having a credit card might seem a dream come true. Using a credit card can allow you to get things you want now and pay later. However, students need to be careful not to run up high credit card bills that they can't pay. Another concern of students is being able to be approved for credit, when they have no credit history yet. Having a credit card in college can benefit a student as long as they can handle the responsibility that goes along with using a card.
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With Your Parents Help
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If you are an unemployed student and on good terms with your parents, one of the best ways to get credit card is by asking for their help. There are two ways your parents can help you. The first way is to make you an authorized user on one of their credit cards. By being an authorized user, you will be able to make purchases but technically, you won't be responsible for the bill--at least not to the credit card company. However, if you abuse the card, your parent can pull you off of the account at any time.
A parent can also help you obtain a card by being a co-applicant on a card you apply for. You are legally responsible for the payments. The upside to this is that it helps you build credit for the future.
On Your Own
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Although college campuses used to be to be filled with credit card companies that would issue cards to just about anyone, the Credit CARD Act of 2009 makes that more difficult. Under the law, it can be pretty difficult for someone younger than 21 to obtain a standard credit card without an income. However, students 21 and older might still be able to be approved for a card.
If you are approved on your own, expect a low limit and a high interest rate. Still, if you manage your card well and pay on time, it can help you to build credit post-graduation.
Some college students get credit cards by applying for them at a retail store. Although these cards usually have low limits, they can still be dangerous to college students, as they have high interest rates and are a temptation to shop for unnecessary goods such as designer clothes.
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Purchases
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Be careful what you purchase with your credit card. Save the credit card for necessary or emergency items such as medicine, food at a grocery store, or a repairing or replacing a flat tire. Don't use your card to buy a round of beers or to get a big-screen TV for your dorm room. It is best to keep your debt as low as possible if your income as a student is low or non-existent.
Don't use a credit card for books or tuition. Although these are necessary for your education, there is no need to charge them and have to pay a high interest rate. Instead, apply for a student loan for these things. Your interest rate will be lower, and you won't have to start repaying the loan until after graduation.
Making Payments
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If you're going to be using a credit card, have a plan for how you are going to make your monthly payments. If you don't have a job, you're probably receiving an allowance from your parents or a cash stipend as part of a scholarship or financial aid. Set aside some of this money each month so you can always pay your credit card bill on time.
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- Photo Credit three credit cards image by Aleksandr Ugorenkov from Fotolia.com
