4 tips for choosing a student credit card

By Ana Gonzalez Ribeiro

Credit card issuers know that the college years are a good time to get young people into the credit habit, which is why new college students often find themselves bombarded by new card offers. But despite all the doom-and-gloom scenarios out there about credit cards and their perils, it's not a bad thing to use a credit card. In fact, regular use of a card is an excellent way to build your credit history.

The key to having a positive relationship with your credit card is to use it selectively. But before you can begin using credit responsibly, it's necessary to choose the right card for your needs.

Choosing the right student credit card

Don't be blinded by promises of low introductory rates, bonus points, T-shirts, backpacks or whatever else you may be offered for signing up. When I was in college several years ago, credit card sales representatives gave away tons of stuff in hopes of earning my business. I think I still have some of their water bottles lying around somewhere.

Instead of leaping at a random offer, inform yourself through research. While issuers like to talk of limited-time offers, don't worry -- credit card companies aren't going anywhere. Whenever you decide to sign up for a card, they will be right there with open arms.

Here are four tips for finding the right student credit card for you:

1. Be choosy

It's too easy to say yes. Many credit cards offer perks like bonus points, travel rewards and 0 percent introductory periods, and these things can be attractive. Still, you need to be selective. If you open too many credit card accounts, your credit score will be negatively affected. It may also be easier to fall into debt if you have too many accounts at your fingertips.

Also, you shouldn't choose a card based solely on perks. Some cards might have added fees or a higher interest limits because they offer perks, so be diligent and consider each card as a whole.

2. Watch out for bait-and-switch offers

Credit card issuers typically place their best interest rates and terms front-and-center. But make sure you read the entire disclosure of each card offer, as the fine print may contain catches. While the card companies may only advertise the attractive terms that it offers to the best-qualified borrowers, you could end up with a more costly deal if you don't qualify.

3. Scrutinize your rate

While the interest rates on credit cards are variable, be sure to note the rate you'll be offered to start. Also note that the rate on purchases will likely be different than the rate for balance transfers and cash advances, with cash advance APRs usually coming in at much higher rates.

Also be careful when choosing a card with a teaser rate. Many cards offer an introductory 0 percent APR on purchases and/or balance transfers, which may last several months. But once this time lapses, you will have to pay the regular APR on your balance, which can sometimes exceed 20 percent on student cards. Choosing a card with a lower ongoing rate is usually a good idea for the long term.

4. Note the fees

Annual fees come with a lot of credit cards, but doing some research should turn up plenty of cards with no yearly charge.

Before you sign on the dotted line, find out about all of the card's potential fees. Almost all cards feature late and over-the-limit fees, and there are plenty of other charges to consider. Look over them all before you make a final decision.

By noting the things above, you'll increase your chances of finding the best student credit card for you. Just don't forget that part about selective use once that new card hits your mailbox.