The ideal time to start building your credit is when you’re a student because it will set you up for success in the long-term. Keep in mind that in order to qualify for a credit card in the United States, you must be at least 18 years old.
Ask Sebby partnered with Deserve to compare the pros and cons of the best student credit cards on the market. Deserve is a venture-backed financial tech company that uses machine learning and alternative data to help the next generation of credit owners gain financial independence through fair credit products.
Deserve Edu Mastercard
No SSN required if you are an international student
Annual fee: $0
Credit limit of up to $5,000
No foreign transaction fees
Earn 1% back on all purchases
Mastercard perks (phone insurance, CDW, etc)
Deserve perks (Amazon Prime Student, Lemonade insurance rebate, etc)
A few notes before we dive in to the analysis:
This post doesn’t include secured cards since it’s a different ballgame. We are going to focus specifically on credit cards for students.
We are comparing student credit cards from major credit issuers and not credit unions. The point is to focus on cards that are available to students nationwide.
This post will not include any blatantly “bad” student credit cards that have hidden fees or charges.
Best Student Credit Cards of 2018
In this post, we’ll compare cards from Bank of America, Capital One, Citi, Deserve, and Discover.
Payment Processor and Annual Fee
The payment processor for each student credit card can be found under the “Type” column: Mastercard, Visa, or Discover.
A good student credit card does not charge an annual fee. I recommend avoiding any card that charges you to build credit because it will be the anchor for your credit history in the long-term.
The last situation you want to find yourself in is paying an annual fee for life or canceling your oldest credit card. All of the cards that we’re comparing in this post do not have an annual fee.
Foreign Transaction Fees
If you plan on traveling internationally in the future, I recommend picking a card that does not have any foreign transaction fees. Foreign transaction fees can range from 2-4% depending on the credit card you have, so it can add up quickly.
The Bank of American Travel Rewards for Students, Capital One Journey Student, Deserve EDU, Discover It Student, and Discover It Student Chrome cards waive foreign transaction fees.
Be aware that not all merchants accept Discover credit cards abroad. Your best bet is a Visa or Mastercard.
The Bank of America Cash Rewards card for students has a $200 signup bonus after $500 in spend within the first 90 days of account opening.
$200/$500 = 40% Return on spend
The Bank of America Travel Rewards card for students has a 25,000 point signup bonus after $1,000 in spend within the first 90 days of account opening.
$250/$1,000 = 25% Return on spend
The Citi ThankYou Preferred College card has a 2,500 point signup bonus after $500 in spend after $1,000 in spend within the first 90 days of account opening. The 2,500 points are equivalent to $25.
$25/$500 = 5% Return on spend
The Capital One Journey Student, Deserve EDU, Discover It Student, and Discover It Student Chrome currently do not offer a signup bonus.
Depending on your spending habits, I recommend picking a card that fits your lifestyle. Some people like optimizing for spending multiplier categories, and others like straight cash back without the hassle of thinking about which card to use.
Another factor to consider is that if you don’t have high monthly spend, the multipliers aren’t that important. For example, if you spend $200 on food each month and the card earns 2% on dining, you’re only getting $4 cash back ($200 x 2% = $4).
If you’re looking to optimize for categories:
Bank of America Cash Rewards for students earns 3% on gas and 2% at grocery stores*
Citi ThankYou Preferred College card earns 2% on dining and entertainment*
Discover It Student earns 5% on select rotating categories; get 10% with Cashback Match in the first year*
Discover It Chrome earns 2% on gas and dining; get 4% with Cashback Match in the first year*
If you want straight cash back without the hassle:
Bank of America Travel Rewards for students earns 1.5X on everything*
Capital One Journey Student earns 1% on everything*
Deserve EDU earns 1% on everything
*= See chart for multiplier details
The Deserve EDU shines when it comes to additional benefits.
Amazon Prime Student Subscription - get reimbursed up to a lifetime total of $59 when you use your Deserve Edu card to pay for your Amazon Prime Student subscription
Cell Phone Insurance - Pay your monthly phone bill with the Deserve Edu card and get coverage for up to $600 when your cell phone is stolen or damaged
Lemonade Insurance Rebate - Use your Deserve Edu card to pay three consecutive months of Lemonade Insurance and get a $10 statement credit
Feather Furniture Rental - Use your Deserve Edu card and promo code DESERVE100 to get $100 off your first month's rental
The Discover It cards also have an interesting side benefit where they reward you for getting good grades. Get a $20 statement credit each school year for maintaining a GPA of 3.0 or higher (up to 5 years).
Social Security Number
If you’re an international student without a social security number (SSN), the Bank of America cards, Citi ThankYou Preferred College, and the Deserve EDU are cards worth considering since they don’t require an SSN to apply.
Learn more about the Deserve EDU, Bank of America, and Citi cards in this post or the video below to compare the cards as it applies to international students.
Best Product Change Options
One of the most important deciding factors of a starter or student card is the “graduation” path. Since the student card is an anchor for your credit history, the ideal card is one that grows with you. Note that in order to qualify for a product change, the card usually has to be older than 12 months, unless the credit issuer automatically upgrades you.
For the Bank of America cards, I don’t recommend product changing them if you plan on banking with them in the long-run. If you have more than $50,000 in assets with Bank of America, the Bank of America 2-card duo is worth considering.
The Capital One Journey can be product changed to the Capital One VentureOne or any other Capital One card after the first year.
The Citi ThankYou Preferred College can be product changed to the Citi Double Cash (2% cash back) or the Citi Dividend (5% cash back on rotating categories).
Deserve regularly looks at your Deserve EDU account to determine product promotion eligibility. This means that it’s possible to graduate to the Deserve Pro in less than one year. The Deserve Pro earns 3% on travel and dining, 2% on entertainment, and 1% on everything else.
The Discover It cards can be product changed to the regular Discover It card that earns 5% cash back on select rotating categories.
Editorial Note: Opinions expressed here are the author's alone, not those of any bank, credit card issuer, airlines or hotel chain, vendors or companies, and have not been reviewed, approved, or otherwise endorsed by any of these entities.
UGC disclosure: These responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.