College is all about getting your feet wet and experimenting with different career choices prior to the start of “real life.” We look for those things that will make us happy, try on different hats, and begin to get a sense of what our place in the world might be after graduation. One of the things that we may begin exploring is our financial selves. Up until this point most of us have largely been supported by our parents, and any credit that we may have would be very minimal.

During this college experience, however, it may be time to begin building our credit so that we are able to navigate freely in the adult world which we are entering. After all, there are rental applications to fill out, cars loans to procure, and even mortgages to seek at some point. And one of the ways that college students can begin to build good credit – without getting out of hand – is through the use of secured credit cards.

Secured credit cards are meant to protect the lender and the consumer equally. They are credit cards that require collateral funds to be deposited into a secured savings account held by the lender; collateral funds that match or exceed the credit limit extended to the consumer. Secured credit cards benefit the lender because it ensures that they will not lose their money even if the consumer defaults on the loan; the lender has the right to recoup the money from the savings account. Conversely, secured credit cards also protect the interest of the consumer in that they do not allow them to rack up too much credit card debt right out of the gate.

Secured credit cards allow consumers to build their credit report slowly and wisely, learn how to budget their money appropriately, and learn their first lesson on the responsible use of credit cards.

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