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Credit cards are valuable financial tools when used properly. am. You can build your credit score, learn about managing your money, earn rewards, and even split large payments into months if you want.Unfortunately, how credit cards work can negatively impact your credit score. Habits, you can qualify for a credit card long before you know about growing debt after the balance has accumulated. This is especially true for college students who often own cards for the first time.

Do college students have more debt than the average cardholder? What do they use credit cards for most often? We've put together the most useful stats to help you understand what you're using.

Insights on credit card bank rates:

  • 57% of college students have a credit card. (Sallie Mae)
  • Only 24% of her college students with credit cards feel they have good money skills. (Sallie Mae)
  • The average college student credit card balance increased from $1,076 in 2016 to $1,423 in 2019. (Sallie Mae)
  • 22% of college students want to better understand the pros and cons of borrowing money on credit products. (Sallie Mae)
  • The most popular types of credit cards for college students are those that are authorized users on their parent's card, have a co-signer, or secure credit cards. (Sallie Mae)
  • 57% of her college students use credit cards only for emergency expenses. (University Finance)

Average Student Credit Card Debt

Student credit card debt has increased in recent years. According to data from the Sallie Mae Majoring in Money 2019 report, the average student credit card balance increased from $1,076 to $1,423 between 2016 and 2019. This is well below the average US credit card debt of $5,221.

Still, students should avoid unnecessary debt. Credit cards are an attractive solution for people who often have limited cash flow, but poor cash flow can make paying off debt too easy.

Student credit card Ownership

Sallie Mae notes that college students have credit cards, but the types of credit cards they hold vary widely.

  • 17 percent have a guarantor card
  • 25 percent have a parent card
  • 28 percent have a secure credit card
  • 64 percent have a separate card in their name

Building credit during college is a great idea, and using student credit cards responsibly is an easy one. Students may not be eligible for most credit cards without a steady source of income, but they can consider the following options to build credit.

  • Become an Authorized User.If a student is unable to qualify for their own credit card, ask a trusted family member, such as a parent or guardian, to can be added as an authorized user of This will help you build your credit score. Authorized users can use a copy of their card to access the main cardholder's credit limit.
  • Open a student credit card.Student credit cards are designed for college students and tailored to their needs. Other factors, such as grades, are taken into account when students apply, as they usually don't have a great credit history.
  • Open a secure credit card. A secure credit card is basically a debit card that helps you build a credit history. When you top up your card, the amount you deposit acts as your credit limit. When you make a payment, your credit behavior is reported to credit bureaus to help build your credit history.
  • Get a co-signer. You may also have the option to apply for a credit card with a co-signer who has a more established credit history than you. Most large credit card issuers have eliminated this option, but smaller institutions such as credit unions may still offer it. Be careful if you go this route. Your cosignatories are responsible for your outstanding payments.

Student credit card usage

We know that more than half of college students have a credit card. But how are they using them? In general, college students are the most likely to use credit cards not only for groceries and entertainment, but also for large purchases and online purchases. Also worth noting is the fact that credit card spending increased across all categories from 2016 to 2019. This suggests that general satisfaction with credit cards is increasing among college students.

Using your credit card for all kinds of purchases is a great way to earn credit card benefits like cash back, but only if you pay your balance in full and use it wisely. According to a 2021 study by CollegeFinance, about 15% of college students exceed their credit card limit, and those students hit their limit 3.8 times on average.

Credit card at university How to Avoid Debt

For anyone looking to buy a house or car, it is beneficial to build up credit as quickly as possible. At the same time, for college students with high spending and low income, credit cards can be fraught with danger.

Luckily, you can avoid credit card problems by following a few important best practices. Enjoy all the benefits without the pitfalls. Most importantly:

Always pay bills on time and in full

The best way to avoid credit card debt is to get into the habit of paying off your credit card balance in full at the end of every cycle. It's a myth that keeping a small balance is better for your credit score. Because of how credit card interest works, paying only the bare minimum is a costly mistake. Any balance will accrue interest on that balance and the balance will grow exponentially. According to College Finance, about 48% of college age cardholders only make minimum payments, which is the most common mistake among college credit card users.

Additionally, you can avoid late fees by paying your credit card balance on time. His second most common mistake College Finance found was nonpayment of payments, admitted by about 38% of college students. Your payment history is the most important factor that affects your credit score. Therefore, every effort should be made to avoid delays in payment. Most credit cards have the option to set up automatic payments.

Make a Budget, Stick to It

Her 2022 Survey by College Ave Student Loans Finds Her 50% of Students Maintain a Personal Budget I understand that you are. Sticking to a budget makes paying with a credit card easier, but college credit card users can struggle with this. Credit cards, according to Sallie Mae in her Majoring in Money report. With a budget, you know how much you can afford and are less likely to make purchases with a credit card that you can't repay.

Use the card only in an emergency.

When you first learn how to manage your credit cards, we recommend that you only use them when absolutely necessary. According to College Finance, about a quarter (23.7%) of college students get an emergency credit card for the first time, and 57% use it only for emergency expenses.

The point here is that this can be easily forgotten if you don't normally use credit cards and don't have the habit of making regular payments.

Credit card purchase category< /th>

College Students Using Credit Cards (2016) College Students Using Credit Cards (2019) )
In-store purchase ≤$20 18% 21%
In-store purchase >$20 31% 32%
Online purchase ≤$20 27% 28%
Buy Online >$20 33% 34%
groceries 25% 30%
eating out 26% 29%
Home entertainment services 21% 25%
Entertainment outside the home 28% 31%