Credit cards and college students: Which ones are the best?

WASHINGTON — When it comes to you and your college-age child, just what constitutes a financial emergency? A sudden trip home for a funeral? A sudden weekend getaway to Ocean City?

“Parents like the idea of having a credit card as an emergency fund,” said Janet Bodnar, editor of Kiplinger’s Personal Finance. “What constitutes an emergency for you, the parent, is not an emergency for a kid.”

With that in mind, Kiplinger’s suggests three credit cards that might be right to put in your student’s wallet when he or she heads to college.

Discover It Chrome for College Students

Bodnar likes the Discover It Chrome for College Students for its returns and its proactive approach to scholarship.

“You can get 2 percent back on gas and restaurant spending, up to a certain limit, quarterly,” she said. “The card also gives students a $20 cash bonus each school year if they earn a GPA of 3.0 or higher.”

It also encourages on-time payments with a 0 percent interest rate for the first six months. Then it pops up to between 13.99 and 22.99 percent.

BankAmericard Cash Rewards for Students

The BankAmericard Cash Rewards for Students offers a bit more cash back (3 percent on gas, 2 percent at grocery stores) and offers an incentive to turn those rewards back into a Bank of America savings account.

The interest rate is zero percent for 12 months, then 13.99 to 23.99 percent.

Capital One Journey Student Card

Bodnar said the Capital One Journey Student Card, like all Capital One cards, offers 1 percent back on all purchases.

“But it increases the total payback to 1.25 percent each month that a student pays the bill on time,” she said. “That’s really a habit that you want to encourage your child to get into.”

On the other hand, this card offers no interest rate grace period. It shoots right up to 24.99 percent.

Age and assets are also two important criteria in picking a student credit card, Bodnar said.

“By law, students who are younger than 21 have to have a co-signer on a card or they have to show proof of assets,” she said.

Plus, Discover and Capital One don’t permit co-signers.

Bodnar also urges you to NOT disconnect your student from bill-paying.

“Parents are usually the ones who are still paying the bills, so kids can easily run up a lot of charges on a credit card and really have no responsibility to pay said charges,” she said. “You’re trying to get them to learn to pay bills on time, but they don’t really have full responsibility yet.”

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