Should college students have credit cards ?
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College period is one of the most exciting phases of life. The entire feeling of turning 18 and going to college is very thrilling and prompting. It’s a dream come true for many students when they step a foot forward into their college lives. After all college life is all about fun, friendships, bunking, trips, creating ever-lasting bonds & memories and new found freedom. For many it is ‘Experience of a Lifetime’. College acts as the evolution of a school going teenager to a blossoming and dynamic adult. The new found freedom implies that students get liberty in a number of matters and even have the right to manage their expenses. As a college student your financial needs are going to be different than your parents or your teachers. The alluring media campaigns of several brands will entice you towards them. Add to it you have other college expenses to take care off. This is when you will demand your parents for a credit card to fulfil your needs. Obviously anyone would do it.
But a wise man has said that before proclaiming anything one must take a look on all its sides. Remember even a coin has two sides- a head and a tail. So let’s go a little deeper and dig out why and why not a student should have a credit card.
Why a Credit card is a must for a student?
Students get more close to being responsible
Students who have a credit card are going to learn about the importance of every penny as they will have a proper control over how they spent it. Having a credit card in your wallet is bound to inject a feeling of responsibility in you. You will not only feel and act like a grown up but also manage to have a control over your expenses.
Perfect time to learn how to handle finances
As a college fresher you are very raw & fresh and full of energy. This is the perfect time for you to start handling your financial matters and learn from your mistakes. The small credit card that fits in your pocket has the power to make you learn how to use credit and make proper & efficient utilisation of it. It will enhance your money management skills as you will be always ahead of the payment due date and make payments on time. This will ensure a student’s first encounter with budgeting along with scheduling of monthly payments.
Most trusted companion in case of an emergency
In today’s scenario you can never know when a crisis or emergency knocks your door. Imagine you are a student of Delhi University and you have to go to your hometown in Lucknow for a family emergency. You can easily book a flight or rail ticket by using your credit card without any hustle. Credit card acts as a big safe bet as even your parents know you can fly back to home as you have credit at your own disposal.
The exciting offers of cash back and other rewards
Just a simple thought of getting Cash Back and other rewards seem so intriguing, right? This is what a student credit card can offer to you. You will be entitled to an interesting rewards and cash back offers if you exhibit good financial habits. You should be aware of the fact that SBI Student Plus Advantage Card offers Rs. 1 for every Rs. 100 spent. The student also has the provision to use his reward points to pay the outstanding balance.
Bye Bye Paper Money, Welcome Plastic Money
At a time when we are talking about going completely cashless, credit cards are the perfect means to keep you covered financially. If you are too lazy to wake up early on a Sunday to buy books, why not buy them online using your credit card. Giving college teens credit cards is the first major step towards a ‘Cashless India’.
A credit card will pave the way for future loans
The transition from a college student to a working professional is a natural process for every teen. Today’s modern student loves to live an independent life and has tenacious ambitions for his future. Buying one’s own house tops the list. Having a credit card here comes in handy if a young and budding adult wants to avail insecured loans from banks. All you have to ensure is that you have a CIBIL score which is above 750. If you have a strong track record of paying your dues, the bank won’t hesitate to provide you loan for your dream home.
No question of withdrawing cash every time
Demonetization has hit you hard and you’re not willing to stand up in long queues outside the ATMs? A Credit card will come for your rescue. So you are short of cash but plan to go for a vacation? Book your tickets and hotel rooms online. Just swipe the card and use it as per your convenience.
Why Credit Cards are not suitable for students ?
The Imminent danger of Internet Fraud
For some people online shopping soothes them. As soon as the sale season pours in, shopaholics college teens become part of the shopping carnival. But many college students are not aware of how to shop online in a secured manner. In such scenario you are always at the risk of falling prey to internet frauds and ultimately suffering huge financial losses.
The Ultimate threat of Hackers
The scheming hackers are always ready to barge into the banking details of customers who use credit cards. The college students due to their inexperience are the easiest targets. It is therefore generally advised that no one should login their credentials while using a public WiFi platform.
If you’re reckless with paying bills then it’s a big burden
Credit cards have been simply devised to make payments at one go and then user has to repay the balances on due time. However, I must caution you that abusing the benefit of credit card for own means and not repaying the amount is only going to hamper your CIBIL score. So you should instill the habit of settling your credit card bills on time. Obviously you wouldn’t want to end your college life with poor CIBIL score and high debt.
It can lead to unnecessary spending
Having a credit card in your pocket will always lure you in buying things which are even not needed. What if you are unable to resist the temptation of buying an expensive perfume just to show off amongst your friends? You will end up using your credit card for the impulsive purchase. But you will be have to deal with the long term effects like repaying the high debt after college is over.
No Parental Control will lead to complete chaos
Imagine a pistol is handed over to a child but no proper guidance or control is ensured. What will the child end up doing? He will either harm himself or others unknowingly. The same goes for a credit card. In case the parents don’t keep a tab on the credit use activities of the college student, he might end up becoming more irresponsible and create a hole in the pocket of his parents.
You need to remember everything be it small or big comes with its own set of merits and demerits. It is a rhetorical question that, should college students have credit cards as it depends on the spending habits a lot. It is upto you how to well and cleverly you use it without getting into any sort of troubles. I have to say a college student using a credit card is a like a feather on the cap of India’s going Cashless campaign. Enjoy the credit as icing on the cake but please don’t misuse it. Be smart, be safe but don’t be exploitive.