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The Study-Abroad Student’s Guide to Credit Cards

Age, income and credit history are factors that will determine the cards you may qualify for. Here are your options and how to evaluate them.
April 12, 2018
Credit Card Basics, Credit Cards, Credit Cards for Average or Fair Credit, Rewards Credit Cards, Student Credit Cards, Travel Credit Cards
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Studying abroad can be an adventure, but to make the most of it, you’ll need a plan for keeping your finances running smoothly.

A credit card can be an ideal payment tool while traveling — not only because students can use it to build their credit while earning rewards, but also because credit cards can offer peace of mind thanks to travel benefits, robust fraud protections and more.

If you’re a student, here are the credit card options you might qualify for and how to determine which ones might work best for you.

Know what you qualify for

You can apply for a credit card once you turn 18, but under the Credit Card Act of 2009, consumers under 21 are required to have either a co-signer or independent income to qualify for a card. Note, however, that many major credit card issuers don’t allow co-signers, and many young college students won’t be able to meet the independent income requirement.

You can apply for a credit card once you turn 18, but consumers under 21 must have either a co-signer or independent income to qualify for a card.

Students 21 and older also still need a source of income to be approved, but they’re allowed to list any income they have reasonable access to — such as income earned by a partner or spouse.

No matter your age, though, it can still be difficult to get approved for a credit card if you lack a credit history.

Credit card options for students

But difficult doesn’t mean impossible. If you’re a college student seeking a credit card, you could have several options:

  • Ask to become an authorized user on someone else’s card. Becoming an authorized user means a primary cardholder grants you permission to use his or her account. You’ll get your own credit card, which is tied to the primary account and has the same account number, and you’ll have full access to the card’s line of credit. If the primary cardholder already has good credit, and if the credit card issuer reports authorized user activity to the major credit bureaus, it could help your credit score. Keep in mind that the primary cardholder is the person liable for the debt, meaning that if you use the card irresponsibly, it can damage the credit of the person who agreed to help you.

    As an authorized user, you’ll get your own credit card, which is tied to the primary account, and you’ll have full access to the card’s line of credit.

  • Get a co-signer. If you’re younger than 21 and you don’t have access to an independent income — and if the issuer allows it — you can ask whether a spouse or close family member would be willing to co-sign for you to get a credit card. In these cases, the issuer uses that family member’s income and credit history to determine whether you’re eligible for the card. Unlike with authorized-user situations, however, both you and the co-signer are liable for the debt.
  • Apply for a secured credit card. If you have no credit history, a secured credit card might an accessible option. These cards require collateral in the form of an upfront security deposit. For example, you give the issuer $200, which gets you a credit limit of $200. This reassures the lender that it can still collect on your credit card balance if you’re unable to pay. Once you build a credit history with a secured credit card, you’ll become eligible to apply for an unsecured card (and you can get your security deposit back). If you can’t afford the security deposit yourself, you can see if a family member might be willing to put up the money.

    If you can’t afford the security deposit for a secured credit card, you can see if a family member might be willing to put up the money.

  • Apply for a student credit card. The federal age and income rules still apply for these credit cards, despite the word “student” in the name. But if you can meet those requirements, a student credit card might work for you. These cards tend to have reasonable credit score requirements for applicants with newer credit histories. Some, like the Discover it® Student Cash Back, even offer cash-back rewards and a statement credit for good grades. The trade-off is that your annual percentage rate likely will be high, and your credit limit likely will be low. That’s how the issuer manages the risk of lending to someone with little credit history.

What you want in a credit card while studying abroad

  • A Visa or Mastercard, if possible. Discover and American Express are less likely to be accepted when traveling overseas, so a Visa or Mastercard may offer more flexibility.
  • No foreign transaction fees. Many credit cards charge foreign transaction fees, typically up to 3% of each purchase, and over the course of a study-abroad trip, those fees will add up. Opt for a credit card that doesn’t charge foreign transaction fees.
  • Bonus points for travel spending. If you qualify for a travel rewards credit card, you can earn bonus points for purchases such as airfare, dining, hotels and transportation overseas. Even if you can’t qualify for a travel rewards credit card, you might be eligible for a card that earns general or flat-rate rewards.
  • Travel protections. Many credit cards offer perks and benefits for travelers apart from reward points. Luggage insurance, car rental coverage, travel delay and accident insurance are just a few popular travel protection features of certain credit cards, and they can be lifesavers when venturing abroad.

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