Are you a Canadian student who is looking to establish a financial profile? Are you tired of being rejected by lenders because you haven’t got a credit history? ( And no one will approve you for an account so you can begin building one. )
Getting a credit card is often seen as one of the benchmarks of growing up. Should you get a credit card at age 18? Should you wait until a little later on in life to apply for credit.
Many teenagers who get a credit card have good intentions when it comes to managing their line of credit, but ultimately end up failing and running into debt. If you can manage your credit, however, having a credit card at 18 could be a very good thing.
Student Cards Limit Credit Lines
Your line of credit has a maximum amount. For accounts that are well-established, credit cards can have limits that are tens of thousands of dollars! At age 18, however, you need to prove that you can manage debt wisely.
For that reason, a typical credit approval will provide you will provide you with $500 in credit that you can use at your discretion. By making monthly payments on time and not going over your credit limit, you’ll begin to establish your credit history.
Secured Credit Cards Can Help To Limit Debt
Secured credit cards can begin for as little as $200. They work because you deposit the money into the account up front and then you can use it like a traditional credit card. Be aware, however, that a vast majority of secured credit cards have high interest rates, so use your purchasing power wisely!
Perfect for emergencies, a secured card’s goal is to transition to a tradition card as soon as you can.
Make Sure You Have Some Form of Stable Income
It is difficult to get a credit card if you don’t have a job or earned income. Without income, you have no way of paying your bills!
Credit card lenders won’t approve an application without that income because they’d be giving you free money that they’d probably never get back! At 18, it can be difficult to have stable income, but not impossible. Find a steady part time job if still a student and you’ll be more likely to get a student card.
Have Someone Co-sign On Your Application
If you have a co-signer for your credit card, a lender is more likely to grant an approval because there are more ways they can recover the debt you can potentially create. A co-signer has the same responsibilities as you do for the line of credit, which means if you don’t pay your bills, the lender can pursue collection from whoever signed the application with you. A good credit history from a co-signer, however, can help you establish your own good credit history.
Consider Waiting If You’re Not Financially Stable
It’s nice to have a credit card, but it’s not really that necessary. Debt is great for emergency situations or for getting a purchase now that you can pay for by the end of the month, but it can also be a trap. If you don’t always have a reliable paycheck at age 18, then consider waiting until you do.
Having good credit can help you get the things you want in life, but a bad credit score can prevent you from doing a lot of things. Work hard, pay your bills on time, and manage your debt responsibly! If you can do that, then you’re ready for a student card at age 18.
Here’s some good news: you’ve got options! These are the best student credit cards that you can get in Canada right now and they’ll help you get your financial future started off with your best foot forward.
The MBNA Student Rewards Card
A lot of student cards will require you to pay a large secured deposit in order to get your line of credit, but that’s not true with this offering from MBNA. Not only will you get a competitive APR rate at 19.99%, but you’ll also earn rewards on a 1-for-1 basis that can earn you some great things! You’ll also get 1,000 points when you make a qualifying purchase and another one thousand points every year you have your account open. There’s no annual fee and no limit to the points you can earn!
The Scotiabank Scene Visa
The Scene Visa Card is the perfect rewards card for those who love movies – and who doesn’t like going to the cinema every once and awhile? You’ll earn free movie tickets and concessions and your first purchase can get you into two free movies! Bonus points are awarded for purchases made at the theater and you’ll earn points on everything you buy as well so that you can always get into a movie you want to see. Read a full review of Scotiabank Scene Visa Credit Card.
L’earn Visa by Scotiabank
If you don’t qualify for the Scene Visa card or maybe the movie scene isn’t really your style, then the L’earn Visa, presented by Scotiabank, might be a better offer to consider. You’ll earn money back on the purchases you make, getting up to 1% back. You’ll also get great perks with this card, such as a discount of up to 20% on your next Avis rental vehicle. There’s no annual fee with this card and the balance transfer fees are relatively low.
Guaranteed Secured by Capital One
If you can’t get an unsecured line of credit from a lender, then your option is to apply for a secured credit card. A secured card is a prepaid credit card.nYou pay a fee and this deposit is held in escrow against your account balance. You get a line of credit that you can use just like a credit card and your payment histories are sent to the reporting agencies, helping you build credit. This option from Capital One can get you going with a great credit card with a competitive APR for as little as a $75 deposit with a maximum deposit of $300, making it one of the best secured options around.