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Among other factors that get reviewed when you apply for a credit card, card issuers will take a close look at your income to confirm you have the funds to make credit card payments. Even though college is a life stage where you might not work and earn a sizable paycheck, you could still qualify for a student credit card.
Most card issuers don't publish minimum income requirements for student cards, but you'll have the best chance of getting approved the higher your income is. Employment income isn't the only type of income that counts, either; income from grants and scholarships can help you qualify. Read on to learn what income can be considered in a credit card application and other factors that affect approval.
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What Counts as Income on a Credit Card Application?
What counts as income on a credit card application depends on your age. If you're under 21 years old, the only income that counts is income you individually bring to the table, and you must show proof that you have an "independent ability" to make credit card payments (unless you have a cosigner). Money earned from working full time or part time is just one type of income that can be considered on a credit card application, however. The other types of income card issuers may accept include:
- Grants and scholarships: If you receive grants or scholarships to pay for school and have money left over for day-to-day expenses, you might be able to include that income on your application.
- Student loans: Student loan funding that exceeds what's due for tuition and fees may be considered income. For example, if you get $10,000 in loans for a semester and your school costs are $8,000, the $2,000 leftover could be accepted as income, depending on the card issuer.
- Allowances: Money that parents or relatives regularly deposit into your personal account may also be considered a source of income.
- Public assistance, alimony or child support: Card issuers may accept financial support you receive from assistance programs, alimony or child support as income.
- Employment income: As mentioned, the money you earn from full-time or part-time work is another source of earnings you can put on your credit card application.
- Household income: If you have a partner or spouse contributing to your household income, you may be able to include their additional income in your credit card application as long as you are over 21 years old. If you're under 21, your own personal income can only be considered in the application.
When completing a credit card application, it's important to be honest and not overstate what you earn. Bending the truth about your financial situation to get approved for a credit card is a form of fraud and can result in immediate rejection of your application, fines, jail time and other consequences. Submitting a truthful application also helps card issuers properly assess the credit limit you can manage, which is to your benefit. If you get a high credit limit and use that credit limit without the cash flow to make payments, it can result in you incurring debt that's hard to pay off.
What Other Factors Matter for a Credit Card Application?
Income is just one factor considered in a credit card application. Below are different variables that will impact your approval odds when applying for a student credit card.
- Age: The minimum age you must be to get a credit card is usually 18 years old since that's typically when you're able to enter a contract; although, it can be easier to qualify for a credit card after your 21st birthday.
- Credit score: Your credit scores are based on the credit history that appears on your credit report. Issuers of student credit cards understand that student applicants may have limited credit history or no credit so credit eligibility criteria can be flexible. However, having poor credit could still affect your ability to qualify, and having stronger credit may improve your chances of getting approved with a better interest rate. If you don't have enough of a credit history for a score to be calculated, you can use Experian Go™ to establish your credit and become scoreable.
- Debt: Other debt payments you're managing can affect your ability to qualify for new credit since juggling those existing payments could make it harder for you to keep up with a new credit card payment.
- School enrollment: Some card issuers require that you show proof of enrollment in school during the card application before approving you.
Student Credits Cards Can Be a Good First Card
Student credit cards tend to be a good starter card option if you're working to build credit from scratch. Note that student credit card limits could be less than $1,000, so your purchasing power may be limited.
Keeping your card usage low and establishing good payment history on a student credit card could help you eventually qualify for a major credit card with a higher credit limit. Shopping around is the best way to find student credit cards to meet your needs and credit profile. With Experian's card comparison tool, you can receive offers that match your credit profile so you can compare card requirements, terms, fees and reward offers before applying.