How to avoid student credit card debt

Written by
Jennifer Doss
Terms apply; see the online credit card application for full terms and conditions of offers and rewards.

At we discuss the most up-to-date news and trends within the credit card space. Since we first pioneered the concept of online credit card reviews in 1998, our team of financial experts has provided comprehensive and unbiased credit card reviews for more than 175 cards, plus hundreds of additional resource articles to help educate everyday cardholders so they can feel more confident about their card choices. All our content is written and reviewed by industry experts. Though our content may occasionally contain references to products from our partners, we maintain strict editorial integrity and advertiser relationships and compensation never influences ratings, reviews or featured products. The difference between editorial content and advertising must always be clearly stated. Learn more.

We’ve all heard of the infamous freshman 15, but what about the freshman $1,000?

Unlike other mistakes that students are bound to make in college, getting into credit card debt and missing payments can affect a young person’s future for years to come. And because of the Credit CARD Act of 2009, unless a student has a significant income, they will most likely have to use a parent as a co-signer to receive a credit card, putting their financial future at risk as well.

The problem of high credit card debt has many implications for a student. Tarnished credit ratings can affect a student’s ability to rent an apartment, find affordable insurance, get a job, and more. It could also affect a student long term as a bad credit score could make it difficult to get approved for things like a car loan or a mortgage.

Whether you are a student or you’re a parent who has co-signed for your child’s credit card or who has allowed your child to become an authorized user on your account, there are a couple of key steps you can take to help yourself or your child avoid student credit card debt.

Learn how to be a responsible credit card user

Student credit card offers can be invaluable tools for young people. While providing security and convenience, if used wisely, they can help students to build the credit necessary to secure other consumer loans, jobs, and lower insurance rates after graduation.

Dr. Carol Carolan, executive director and founder of the Center for Student Credit Card Education, says that the single best thing parents can do to help their children avoid the pitfalls of credit card debt is to educate them. Carolan offers the following tips:

  • Get a credit card with a low limit and no annual fees.
  • Discuss with your child the details of the credit card including interest rate on purchases and cash advances.
  • Review all expenses every month.
  • Show your child what finance charges might apply if the balance is not paid in full and on time. This includes any interest, fees, and penalties.
  • Be a good role model.

Experts don’t all agree on the appropriate age for a first credit card. Dr. Robert D. Manning, author of Credit Card Nation, for instance, argues in his article “Credit Cards on Campus,” that having them at an earlier age may actually result in fewer debt problems later on. Other experts argue that waiting until the junior or senior year in college is best. The bottom line parents need to realize is that once students reach the college campus, they will be inundated with credit card offers and will likely be able to get a card regardless if they are supported financially solely by their parents or not, making credit card education more important than ever.

And talking with students involves more than mere calculations of fees, interest rates, and balances. Students need to understand the messages they receive through advertising, the difference between a want and a need, as well as the lure of money. Give students a healthy, realistic perspective of money and material possessions to better equip them to make wise decisions on their own.

Make a plan for paying off debt

Will your card be used for just books and groceries, or will you use it for things like entertainment purchases and gas as well? Or maybe you’ll only use it strictly for emergencies? 

Consider your income. Will you be able to pay more than just the minimum balance on your credit card statement each month?  Are you paying the bill yourself? If not, parents, be realistic and upfront with your child about how much they can use the card for each month.

Making a plan for how a credit card will be used can help card holders from falling deep into debt. Though responsible credit card use is a good way to build credit, it’s important for new users to start slow, setting and sticking to a reasonable monthly budget.

Just because you have a credit limit of $1,000 doesn’t mean you should spend $1,000 every month. Realistically, you should only be putting on your credit card what you know you can quickly pay off. Obviously though, things happen, and there are going to be unexpected expenses that come up from time to time. If you’re using your credit card for these purchases, be sure you’re paying the maximum amount your budget allows each month until you pay this balance off. Student credit cards usually come with high APR rates, meaning, even a little bit of debt can add up fast. A monthly credit card payment calculator can help to keep you on task.

College isn’t just about learning new subjects; it’s also about teaching students about growth and responsibility. Credit cards can be great tools towards helping students develop healthy spending habits throughout college, while also establishing a baseline for future borrowing behavior. 

Jennifer Doss
CardRatings Executive Editor

Jennifer Doss is a credit card analyst and the executive editor of She has worked as both a print and online journalist and has over a decade of experience in the media industry. Her published work has covered a broad range of topics, from...Read more

Featured Partner Cards:


The information in this article is believed to be accurate as of the date it was written. Please keep in mind that credit card offers change frequently. Therefore, we cannot guarantee the accuracy of the information in this article. Reasonable efforts are made to maintain accurate information. See the online credit card application for full terms and conditions on offers and rewards. Please verify all terms and conditions of any credit card prior to applying.

This content is not provided by any company mentioned in this article. Any opinions, analyses, reviews or recommendations expressed here are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by any such company. does not review every company or every offer available on the market.