Obtaining a student credit card shortly after becoming an adult in your province or territory is a smart choice. In fact, I encourage every one of my students to do this on their eighteenth birthday.
Getting a credit card as soon as possible will help students start to develop credit early. This can have a major impact on future plans, such as purchasing real estate or a vehicle.
A student’s lifestyle doesn’t even have to change to do this! Most of the students in my high school are regularly using their debit cards to make purchases, such as gas, food, and clothing. They have the money to buy what they want and withdraw that immediately from their bank account. By replacing their debit card with a student credit card, the switch will be seamless while offering more perks.
However, using the credit card wisely is key. By using simple personal finance techniques, such as budgeting for your purchases and paying off your credit card right away, your credit score will only climb higher and higher.
How to Choose the Right Student Credit Card
Every major bank and credit union will push their products to students when they turn eighteen. However, the offerings of their financial institution, whether it is by choice or because their parent’s bank there, may not be the best for their lifestyle choices.
Therefore, it is important that everyone looks at their options before choosing their first credit card.
For this article, I am going to specifically focus on credit cards that have zero annual fees, have achievable requirements, and have usable rewards.
Continue reading to see my choices for the best student credit cards based on a number of different lifestyle choices!
Best Student Credit Card for Cash Back
Tangerine Money-Back Credit Card
The Tangerine money-back credit card takes the top spot in this category due to its low eligibility requirements, and freedom to maximize its cashback options.
Students can access a ton of perks that will help them put more money back into their accounts. Because most students have regular spending in certain categories, such as food and gas, they can specifically choose those categories for increased cashback. The cashback offerings that the Tangerine money-back credit card gives you are:
- 2% cashback on two categories (includes food, groceries, gas, entertainment, public transportation, recurring bill payments, and more) with earnings being applied to future credit card statements.
- 2% cashback on three categories if you deposit the earnings into a Tangerine savings account.
- 0.5% cashback on everything outside of your chosen categories
- Ability to edit category choices.
- No cap on cashback earnings.
In order to qualify for this card, an applicant must:
- Income requirement of $12,000.
- Be the age of majority in their province/territory.
- Be a Canadian permanent resident.
For most students, these requirements are easily met with a part-time job.
Tangerine typically offers various promotions for new people who sign up. A couple of past promotions I have seen include 4% cashback in your chosen categories for a three month period, and a $250 bonus if the user spends $5000 or more in the first three months.
Because Tangerine requires a credit check before approval, it is important to understand that you may not get approved on your first attempt. There are a few ways to approach this leading up to the day you can apply. Initially, having an existing Tangerine chequing and savings account can put you in good standing with the company. If they see that you have the money to maintain a credit card through them, they may be more willing to accept you. Additionally, you can take on other approaches to building credit in your teen years, such as piggybacking.
In fact, I am such a fan of these offerings that the Tangerine money-back credit card is my primary one. Although there are other credit cards available to me with my annual salary, I still use my Tangerine card as I bank with them and love having the versatility of earning 2% cashback in three categories I regularly spend on.
Best Student Credit Card for Entertainment
Scotiabank Scene Visa Card
The Scotiabank Scene Visa card is the best student credit card for people who love going to movies. With the cost to attend a movie increasing at a fast rate, it pays off quickly to turn your everyday purchases into a variety of rewards, including free movie tickets, restaurant gift cards, or discounted food and drink.
For students who like going out with friends or a partner, the Scene Visa card can be perfect to offset some of these expenses. The rewards for using this card are:
- 1 Scene point for every dollar spent.
- 5 Scene points for every dollar spent at any Cineplex theatre, The Rec Room, or at cineplex.com.
Additionally, Scotiabank offers various promotions for signing up for this card. At the time of writing this, they are offering a bonus 2,500 Scene points if you spend $500 or more in the first three months.
The requirements for this card are:
- Income requirement of $12,000.
- Be the age of majority in your province/territory.
- Be a Canadian permanent resident or a foreign worker with at least 6 months left on your permit.
For students who prefer entertainment over other things, this is a perfect starter credit card for them.
Best Student Credit Card for Independent Living
President’s Choice Financial Mastercard
In my opinion, the President’s Choice Financial Mastercard has the best points reward system available on a zero annual fee card. Students who use this card can quickly earn enough points to exchange 10,000 points for $10 off their groceries. This is perfect for any student planning on moving out for post-secondary or work after high school, as groceries will be one of their biggest expenses.
The rewards for using this card are:
- 10 points/$1 spent at designated PC grocery stores (Real Canadian Superstore, Loblaws, etc).
- 25 points/$1 spent at Shopper’s Drug Mart.
- 30 points/litre at Esso and Mobil gas stations.
- 20 points/$1 spent at PC Travel.
- 10 points/$1 spent everywhere else.
These rewards can increase if you qualify to upgrade to the World or World Elite Mastercards. The best part is both of the upgraded cards have no annual fees.
This credit card is only subject to a credit check. I would encourage students to take similar approaches as the Tangerine money-back credit card to assist them in getting approved.
Like the Tangerine card, I use the PC World Elite Mastercard for groceries and gasoline. When pairing the rewards for using the card with the weekly offers on the PC Optimum app, I quickly earn enough points to get my weekly grocery hauls for cheap or free!
Best Student Credit Card for Travellers
BMO Air Miles Mastercard
The BMO Air Miles Mastercard can quickly allow students to accomplish their travel dreams. By using their credit card for normal purchases, students can accumulate Air Miles on top of what they earn using an Air Miles loyalty card.
The rewards for using this card are:
- 1 Air Mile for every $20 spent.
- 2X Air Miles when using the card at participating Air Miles partners.
- 1.99% interest rate on balance transfers for the first nine months.
Additionally, BMO is currently offering 800 bonus Air Miles upon signup. This is enough for a handful of domestic flights.
For a card with zero annual fees and zero income requirement, the reward system can help anyone realize their travel dreams.
Which Student Credit Card is the Best Choice?
In reality, you cannot go wrong with any of the above-mentioned credit cards. The choice will be entirely based on what goals you have set for yourself.
However, due to the financial strain a lot of students go through in high school and post-secondary, I believe the Tangerine Money-Back Credit Card stands out as the winner. Because you have the freedom to select two or three 2% cashback categories depending on your daily banking situation, the amount of returned money can quickly accumulate.
Because I am already a huge supporter of Tangerine for daily banking for all people, I would push all students to Tangerine for their first credit card. By tieing this into an existing Tangerine savings account, you gain that extra 2% cashback category which can make a large difference.
Regardless of choice, it is important to use your credit cards the right way. By paying back your balances in full, using it for planned purchases, and trying to avoid cash advances from your credit card, you will quickly build up your credit. Your future self will thank you.
Do you have any other credit cards you think should be on this list? Do you have any experience with these cards? Share in the comments below!
Thanks for reading!