Discover Student Card

Well, we went to the Student Credit Card page (here) on the 101-creditcards.com website and applied for a Discover® Student Tropical Beach Card. We were approved quickly and just received notice that the Discover Student Card is on its way!

This was actually really easy. As I mentioned, my son is 21 so he did not have to have a co-signer. I was concerned about his current employment situation, since he is a student and not currently employed, but this was not a problem.

On the application form, we just replied that he was not currently employed but we also included his current annual salary. He did have an annual salary (for last year and for previous years) since he had worked every summer since he was in college.

So we are now well on our way to establishing a credit history for him. We have not yet received the card and the specific details (like his credit limit) but I will post any relevant information here as it becomes available.

I am really glad that we got him started off with a Discover Card which has no annual fee and also has the cash back benefit.

Establishing Good Credit

Establishing Good Credit or a Good Credit History is an important step for most young people and there are quite a few ways to go about doing this. Of course this is a double edge sword and you will want need to be responsible with your credit and finances so that you do not shoot yourself in the foot and do the exact opposite (creating a bad credit history).

My son is a senior in college and just turned 21. I am currently in the process of helping him to establish a good credit history.  My son is fortunate that I am around and have good credit myself and am willing and able to help him to establish his own good credit history.  I am also fortunate that he has always been financially responsible.

Although there are ways to establish a good credit history on your own, it is much easier if you have help from someone that is willing and able to help you out. This article focuses more on establishing credit when you have someone, with good credit, that is willing to help you to get started.

Way back (I won’t say how far ) when I was establishing a credit history for myself, one of the common ways to do this was by having a parent co-sign on a car loan and then to pay off your car loan~ making all payments on time ~ and this is what I did.

My son did just recently buy a used car (with my help) but we choose not to finance the car with a car loan. In this case it was much easier for the car purchase and I really did not want to deal with the used car dealer any more than was absolutely necessary.

So in our case, we just burned up the option to use a car loan as a tool to establish a credit history but there are still other options available.

We had considered applying for a secured credit card ~ where you deposit a specified amount of cash (often a minimum of $300) into an account that is locked and used as collateral for the bank (which they can take if you default on your credit) ~ but this method requires more time to establish credit than the method that we choose.

We choose to add my son as a joint owner on 2 of my credit cards in order to piggyback my good credit to his name. Keep in mind that you need to set up the person that needs to establish credit as a joint owner on your credit cards and not just as an authorized user.

I was also told by our banker (from a major bank) that the time involved in building a credit history this way varies depending on a number of different factors but it would be fairly common to build enough credit history in about 6 months in order for him to be approved for a credit card in his name alone.

I was also informed to keep him on my credit card (the established card) for at least 6 months after he gets his own card in order to keep his credit rating high enough to be fully established under his own name.

Another way to establish a credit history for a young person, if they are a college student, is to apply for a Student Credit Card.  Keep in mind that this process has changed with the Credit Card Act of 2009 and that students that are under 21 will need a co-signer or to prove that they have enough income to cover the potential debt.

Discover Student Card

Since my son is 21, our final step in establishing a credit history will be to apply for one of the Discover Student Credit Cards (with the cashback option).  My son has worked consistently every summer but not during the school year.

Stay tuned and I will let you know if he qualifies for the Student Credit Card on his own or if they still require a co-signer due to his current status.

Credit Cards for Online Purchases

Since I had used it so much and had so many links into my Discover Card (auto payments), I decided to be a little more careful with it and not to use it for online purchases.

This is not really necessary (if you are prudent with your online purchases) but I had decided to use my TGI “The Great Indoors” (Sears) Master Card for my online purchases, instead.

This worked OK for a while but then I started getting quite a few rejections on the TGI Master Card. The rejections were always for security reasons.

Now, I love that the credit cards have all this extra security, but in some cases the security has been too much to the point that I could hardly use the card.

Well, this was the case with the TGI Master Card from Sears. It got rejected with so many legitimate online transactions that I had to revert back to my other cards.

I now use my Discover Card and another cash back Visa card that I have from Chase for all of my online purchases and they work just great.

Although this is a “cool looking” card and their are some good benefits with the card, it never caught on as much as the Black Card from American Express.

The Amex Black Card is actually the black colored Centurion Card from American Express and was renowned as the most prestigious and exclusive card in the world. The Amex Black Card was an invitation only card that is offered to selected Platinum Card members and I can not tell you right now if this card is still being offered to existing members.

Well it’s survival of the fittest out there in the credit card world and you just have to find the best offers out there while they last. I know that the Visa Black card did have an annual fee and I don’t know the additional benefits were worth the fee (I always stay away from cards with an annual fee myself).

Anyway, if you were considering one of these cards, you better apply before the offer expires.

This web site contains primarily credit card information. This blog will contain credit card, debit card and misc financial information mostly as it applies to credit cards but I will reserve the right to dive further into financial information as this blog develops (after all it is a “blog”).

I may be adding specific credit card information updates (rates, terms, etc.) as I become aware of relevant changes, but I have put a disclaimer at the top of this blog that specific credit card information will only be valid as of the date of the blog post.  This is important since the credit card companies watch this type of thing very closely.

Personally, I highly favor Cashback and Rewards Credit Cards, so you can be pretty certain that I will be blogging about that particular subject fairly often.

There are, of course, numerous other reasons to use credit cards (and/or debit cards) and everyone’s personal financial situation will be different. If you currently have an outstanding credit card balance, I highly encourage you to pay off as much of that debt as possible. I fully understand how difficult that can be (I was in that situation at one time myself) but it is very important to do what you can regarding paying off any outstanding debt.

OK, I had planned to keep this initial post short and have already written more than I had initially planned to write.

Please feel free to comment or check back soon.

Rob.