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Student Credit Cards
By Phil Edwards
With graduate debt averaging over £12,000, the ability to spread the cost
of further education using a student credit card is obviously attractive. Adding
to their appeal is the fact that these cards are relatively easy to obtain. Unlike
many standard credit cards, they are available to people who do not have a regular,
minimum income and credit history. They often come with tempting offers including
low rates for an introductory period, shopping discounts and free CDs. Flexing
student plastic has the additional benefit of creating a credit history that can
be used to support future loan and mortgage applications.
So, with no regular income and credit history, what exactly is the attraction
of students for the credit card companies? Well, the fact that graduates can
expect to earn, on average, £400,000 more over their lifetime than the
national average, means that financial institutions are eager to attract this
extra earning potential. Banks and credit card providers know that the general
public are reluctant to go through the hassle of changing accounts, so by attracting
students early in their career, they are likely to stay with them for life.
Student credit cards can have drawbacks. If balances are not paid off in full
each month, most cards aimed at students notch up higher interest charges than
their regular counterparts. These additional charges often cancel out the benefits
of store discounts or free CDs. Credit cards aimed at those in further education
may not attract the useful bonuses that regular plastic does, for example air
miles, cash back on purchases and interest-free periods.
latest offers available to students
Credit cards aren't free money. Flashing plastic creates a debt that
must be managed alongside the repayment of tuition fees, bank overdraft and
student loan repayments. Handled well, a student will benefit in the future
from a good credit rating. Managed poorly, students may end up with a bad history
that will adversely affect subsequent credit applications.
It's also important to note that some standard credit cards do not require
the holder to have a minimum regular income or credit history. Students working
part time and holiday jobs may earn enough to apply for a range of standard
cards. So, it is important for students to check out all suitable credit card
deals, not just the ones aimed at people in further education.p>
A little research before signing on the dotted line can really pay off. By
taking the time to compare the deals available on all suitable credit cards,
interest repayments can be minimised and the benefits of holding a card maximised.
And that really is good news for students.
About the Author
Phil Edwards is a Business analyst in the city of London, freelance writer for several finance magazines and websites and co-owner of First UK Credit Cards and First UK Loans
Article Source: http://www.simplysearch4it.com/article/27880.html
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