Most student cards on the market are a rotten deal. I’m not denying the fact that the 18-24 age range is a riskier group for the banks – but still – that’s not an excuse for the excessive APRs and crappy benefits!
I had a BofA credit card at age 19. It wasn’t a student card but might as well have been, because it was a very basic account with almost no benefits.
Here’s a review of the current Bank of America student credit card. There are 3 versions available but each comes with major disadvantages you need to know about.
Advantages for 2013?
Reasonable Interest Rate – Most cards in this category have APRs as high as 20% or more. However as of Jan 2013, BofA’s applications lists the following range for interest rates.
Keep in mind that since you are new to credit, you will probably get a rate at the top end of that range (so don’t be surprised to get 20.99%).
It would still be stupid to carry a balance at that rate, but at least it’s somewhat reasonable (in comparison).
No Annual Fee – Not really surprising though, as most student cards don’t charge a fee.
Account Management Features – Aside from the obvious things you would expect, there are a few unique features: the ability to text and get account information in seconds, as well as optional email/text alerts for balances and payment due dates.
Other Benefits (Fluff) – When I looked at the BofA student card application there were several other benefits listed but they were basically just fluff. Don’t be fooled that it’s a “Platinum Plus” Visa as that doesn’t really mean anything nowadays (in fact, it’s the same level my BofA Visa also started out at when I was 19).
Examples of fluff? They listed 4 different benefits related to fraud liability and protection but at the end of the day those aren’t anything special because by federal law, you’re protected against fraud on all credit cards. If there are unauthorized purchases made, the most you can be held liable for is (a) a max of $50 if someone used your physical card to make the purchases, or (b) $0 liability if only your account number was used while the card was still in your possession. That goes for all credit cards, not just this one.
Disadvantages for 2013?
Boring rewards program (or none at all!) – This is a major letdown and one of my biggest complaints about student credit cards… so many of ‘em don’t give you rewards!
Why not? I guess they think you don’t deserve them. Well, I say that’s BS! Whether you are 18 or 80, everyone should be getting something back. Credit card companies make 1-2% on your purchases (paid by the stores/merchants) so it’s only fair that they chuck back some of that to you, right?
Unfortunately BofA’s main student card has no rewards program whatsoever. Their 2 other cards (the “Cash Rewards” and “Travel Rewards”) do come with a rewards program, but they’re not always the most lucrative Between all 3 credit card I would go for the Cash Rewards version if you insist on sticking with BofA.
If you want cash back or points, compare these student credit cards with rewards.
New and Brutal Penalty APR – Back in 2012 this card didn’t have a penalty APR. But for 2013 they’ve added a brutal 29.99% penalty APR. You get stuck with this higher rate if you make late payments.
Student Identity Theft Protection (Discontinued For 2013!) – Previously their student cards offered this service for 4 years with no charge. The old 2013 application’s fine print described it as:
- Enrollment/activation is necessary to get the benefits (but there’s no charge to do that).
- Each business day your credit file is reviewed for signs of identity theft/fraudulent activity. Whenever “certain changes occur” they will notify you (but they don’t disclose what specific changes trigger that).
- If you’re a victim you can call and get advice, but you will be the one responsible for actually resolving the issues (such as contacting the credit bureaus, filing disputes, etc).
But the bad news is they took this benefit away from 2013. You will no longer get it if you apply. It’s unclear whether or not existing cardholders still have it.
Few Useful Benefits – Aside from rewards, one of the main reasons (in my opinion) to have a credit card is so you can take advantage of the benefits it offers. With many other student cards, on qualifying purchases you can get a free extended warranty and 90 day protection against theft/accidental damage. Unfortunately you won’t get any of those with this bare-boned Bank of America Student Visa.
BofA Customer Support – Now in their defense, I have noticed their credit card customer support has improved lately. But still, it doesn’t exactly have the best reputation (to put it nicely). Probably the best student card for this category is from Discover. Did you know that all of Discover’s customer service reps are in the US? A rarity for a credit card, that’s for sure!
Overall, the Bank of America student card is an alright choice for building a credit history and score. But aside from the ID theft protection, the lack or rewards and useful benefits means all you are getting is plain vanilla credit card.
Be warned that even though the APR isn’t horrible, it still doesn’t make any sense to carry a balance on. Simply put, all student credit cards (including this one) will have APRs higher than any student loan will charge. So if you need money for tuition and expenses, do NOT use a credit card as your source!
And on that note, If you think you will be prone to getting in trouble by using credit, then it will probably be best for you to avoid it altogether (at least for now).