Getting a student credit card is one way students can start building credit. But what if you’re about to graduate or considering whether a student card is right for you? You may be wondering what happens to your student credit card when you graduate.
What Is A Student Credit Card?
In general, Student credit cards work just like any other credit card. But it is specifically aimed at giving students a starting ticket. Starter credit cards for students tend to be easier to get approved for. This is because it is offered to those who still need to build credit. Student credit cards may also have fewer rewards options and lower credit limits than other credit cards.
To open a student credit card You may be required to enroll in higher education or trade school. You must be at least 18 years old, and if you are under 21, you may be asked for a co-signer or proof of ability to pay as usual.
In addition to the various requirements and rewards. In general, Student Credit Cards work the same way as most other cards. You can make purchases online or in person with your card. And make sure you make at least the minimum payment each month to help avoid additional fees.
What Can You Do With Your Card After Graduation?
You may be wondering what happens to your student credit card when you are no longer a student. There are a few options for doing this:
- Keep your card as is: This means you will continue to use your card as you normally would. Or you can leave the card open, but don’t use it.
- Cancel your card: If you don’t have a remaining balance. You can close your account with your card issuer and remain without a credit card or apply for a new card.
- Upgrade your card: You may be able to switch to a non-student credit card with the same issuer.
It is also possible that your account will be automatically reclassified when you change levels. It depends on the card issuer.
The good news is that card issuers usually don’t automatically close or cancel your account just because you graduate. You may have time to decide what you want to do with your credit cards as you begin your graduate life.
How to choose the right option for you?
When you are trying to decide what to do with your student credit card after graduation, Considering the pros and cons of various options Yours is also important. One thing you may want to consider is your credit score. If you make regular and timely payments while you have a student credit card You will see this information on your credit report. This may give you more options when deciding on a route.
If you haven’t thought much about your credit score. Don’t forget to also read about the importance of marks. Your score can affect many things, such as your ability to rent an apartment. Applying for a car loan or mortgage Determining the interest rate for loans, etc.
Keep your card intact
How long can a student credit card be accepted? The issuer may allow you to leave it open indefinitely.
The main benefits of keeping your card are as follows:
- Your credit score is unlikely to be negatively affected if you continue to make at least your minimum payments on time each month.
- Keeping the card open maintains your oldest credit limit. This can help improve your credit score over time.
Here are some downsides to keeping your card:
- This can be limiting. This is because you may qualify for a higher credit limit. This can give you more flexibility in your spending. It also helps keep your credit utilization rate low.
- You may be able to get a card with better rewards than a student card can offer. Non-student cards may have more robust rewards programs. Additionally, you may be able to find a card with a rewards program that better reflects your interests or lifestyle.
If your student card has an annual fee You may be able to switch to a card without a fee.
Cancel your card
If you’re not sure what you want to do or don’t think you want to continue using your student credit card, you might be wondering: Is it a good idea to close your student credit card? While this choice is subjective, there are some potential downsides to canceling your card, including:
- Your credit age is a factor in calculating your credit score. By closing your student credit card This can be the first line of credit or the only line of credit. You may see your credit score take a negative hit.
- If you cancel the card You may not be able to access the benefits or rewards that come with the card.
- If you canceled your student credit card You decide you want to use another card. Your credit score will be temporarily affected. This is because your credit will be strictly monitored.
Upgrade your card
Ready to switch to a new credit card? You may want to consider upgrading your card. Some of these benefits may include:
- You will be more likely to maintain your credit term, which will maintain your credit score. Switching to a new card from the same issuer usually means that your existing account will be transferred. It has not been cancelled. This means you won’t lose the years of work you put into this line of credit.
- Chances are you’ll get a better credit card overall when you get rid of your student card. Your new card may have higher limits. Better rewards and more privileges
The potential disadvantages of upgrading your card are:
- You will not be eligible for special bonuses or promotions as you are not required to complete a new application to upgrade.
- The issuer may perform a credit check before you upgrade your card. This can temporarily lower your credit score slightly.
Summarize
In the end, what happens to a student’s credit card upon graduation is often solely in the graduate’s hands. Although it is possible for the issuer to upgrade your card automatically. But you may have to decide for yourself. Or you may want to keep your card as it is or cancel it entirely. Be sure to weigh the pros and cons of each option. And considering the importance of your credit score as you enter adulthood, keep in mind that Chase does not offer student credit cards for new applicants.