Student Credit Cards 101

How to Apply

It is possible to apply for credit cards online with a secure webpage, over the phone, at a financial institution, or at college functions at which credit cards are offered. It may be convenient to have the student's bank account and credit card at the same institution, or to set up the student with the same company that other family members use.

In any case, it is likely to require you to provide several different kinds of information:

• Identifying information such as name, date of birth, mother's maiden name, and social security number. This fulfills a two-fold function of identifying you and providing security (i.e., making sure it's really you).
• Contact information, such as home and school street addresses and telephone numbers, as well as a preferred email contact address. An alternate contact may also be requested.
• School information, such as the name and location of the college, the student's current class, and expected date of graduation.
• Financial information, such as currently held bank accounts and yearly income, as well as the type of source from which the income derives (e.g., summer job, allowance, etc.).
• Extras. You may also be requested to choose a card design and to verify that you have read and agree to the terms and conditions.

Terms and Conditions

If you are filling out an application and do not have to verify that you've read the terms and conditions, you should locate them and read them any way. No matter what the advertisement, poster, or representative told you, it is the terms and conditions that detail exactly what you're signing up for, so you must read it and - if you do get the card - print a copy and keep it in a safe place so you can refer to it if necessary.

There are several important things to do when you receive your credit card.

• Check Out What It Looks Like
• Card Number. The large type number with spaces is your credit card number or account number.
• Valid Until. This section gives the month and year of the card's expiration. Every few years, the credit card issuer issues all customers in good standing a new credit card. Note the month and year because they are part of the information that is used in authorizing a credit card purchase. When you have been a customer for awhile, the company may add an indication of how long you've been a cardholder.
• Cardholder Name. Lower on the card you will find your own name, which should be your legal name, not a nickname that you only use casually.
• Magnetic Strip. On the back of the card you will find the magnetic strip which is used to swipe the card.
• Signature Strip. Below the magnetic strip is a spot for you to sign. You may wish to use an indelible pen or thin marker. The card does not become valid until you sign, and you will likely have to also phone the company to activate it as a security measure to make sure that you are the one who received the mailing. There may be an easily removable sticker on your card with an activation phone number for you to call.
• CVV. To the right of the signature strip on most cards (it's on the front of the card for American Express) is the Card Verification Value Code or CVV. If you make an online or phone purchase, you may need to enter this number as an extra security measure.
• Customer Service Phone Number. This is the number you call if you have any problems using your card.

Handling Your Credit Card

Your credit card is a key piece of identifying information and the door to your funds. It being in someone else's possession other than yours could spell a very, very serious problem. It should be kept in your wallet or the equivalent along with other crucial financial and personal information, such as your driver's license and your ATM card.

This would also be a good time to review the article "Managing Your Credit Balance" to help you make some overarching plans for how you will fit your credit card into your life. Setting up a system for yourself that ensures that you don't overspend, can pay the full balance each month, and are always aware of when your payment is due so you can make sure it's on time will serve you well as you learn to live with the financial capabilities that your card enables.