MatchingMillions Spotlight: Credit Cards vs Debit Cards- What’s Best For Your College Student | SmartBlackWoman
I made the decision to give my son both a Credit and Debit Card. The Credit Card would be used primarily for expenses related to College and the Debit Card for entertaining. He and I went into a Chase Bank and applied for a Credit Card. I was able to set the credit limit which was $2000. In addition to setting the limit, I monitored his usage and paid the balance due in full monthly.
Here we are, four years later and the account has been closed and paid in full. Last year of College approaching and he decided that the Debit Card was sufficient. My experience was good, however most aren’t. College Students tend to be the biggest target of Credit Card companies. The Credit Card Act which took affect over 2 years ago makes it much more difficult for students under the age of 21 to get a card without a co-signer and/or sufficient income. So let’s talk about what’s best for your child; Credit Cards help students build a credit history. Typically the interest rates are low and they do not allow you to spend more than the limit you’ve received. Debit Cards are linked to Checking Accounts and just like a Credit Card, you can not spend more than what you have. The downside of Debit Cards is that you can not establish a credit history, however you’re not in debt.
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Buzzed by DryerBuzz August 22, 2012 · Browse More Stories Like This In Matching Millions .