The Pulse

1 In 10 Students Think Credit Cards Are Free Money

Schools fall short, and parents are more comfortable talking about the birds and the bees

New research from, the consumer credit website offering free credit scores and full credit reports. 

Poor financial literacy in the U.S. has gotten to the point that more than 2 million college students (1 in 10) believe credit cards are free money, according to the personal-finance website WalletHub’s 2019 College Student Financial survey, released today.

Additional survey results can be found below, along with our editors’ picks for 2019’s Best Student Checking Accounts and Best Student Credit Cards, selected from hundreds of offers.


  • 30% of students give their financial knowledge a grade of C or worse. 5X more female students than male students graded their financial knowledge an “F.”
  • 14% of students would rather miss a payment than a party. Lower-income students are 4X more likely than high-income students to say they’d rather miss a payment than a party.
  • 1 in 10 students say their parents would not approve of their credit card transactions. Nearly 2 in 5 students say their friends would make fun of their credit card transactions.
  • Best Credit Card for Students: Discover it® Student chrome – 2% cash back on your first $1,000 in restaurant and gas purchases each quarter. 1% cash back on all other purchases. No annual fee or foreign transaction fee.
  • Best Checking Account for Students: Capital One Money Teen Checking Account – No monthly fee, overdraft fee or ATM transaction fee. 0.25% APY on all balances.

Q&A with WalletHub CEO Odysseas Papadimitriou

Are you surprised that 1 in 10 students think credit cards are free money?
“Unfortunately, I am not surprised that 1 in 10 students think credit cards are free money, considering the current state of financial literacy education. Schools aren’t teaching money management, at least not nearly enough, and many parents are actually more comfortable talking about sex than money.”

Do you have any tips for teaching young people about money?
“It’s important to lead by example, for starters. Even if you don’t manage your finances responsibly, having an open dialogue about money management matters in your household and recognizing your mistakes can go a long way. Your children will naturally pick up a lot of good habits and useful information. As with any other skill, however, practice makes perfect. So it’s important to give young people experience managing a checking account and a credit card before they head off to college, while you can still supervise and provide feedback. Making your child an authorized user on a credit card account is a good way to introduce them to credit before they can qualify for a student credit card. Most issuers don’t have an age requirement but do allow you to set a custom spending limit for authorized users. You’ll have full visibility of their transactions, and they’ll start building credit history.”

How old do you have to be to get a student credit card?
“A lot of people have misinterpreted the post-recession credit card laws to mean that only applicants age 21 and up can get approved for a credit card account. That is not true. The minimum age to qualify for your own credit card account is still 18 years old. The post-recession rules just specify that applicants under the age of 21 will be judged based on their independent ability to pay, rather than household income.”

Excerpts from the College Student Financial survey

Money-Saving Tips For College Students

Identifying the best student credit card is only half the battle. You also need to use it responsibly, avoid common money-management mistakes, and build financial literacy for success after graduation.

30% of students give their financial knowledge a grade of C or worse. 5X more female students than male students graded their financial knowledge an "F"

  1. Consider Credit Building Your Top Priority – A good credit score will save you thousands of dollars per year on loans, lines of credit and insurance premiums. It may even help you land your dream job or lease a new car. And two of the keys to building a good credit score are making on-time payments and establishing a long track record of responsible borrowing.
  2. Don’t Make Purchases If You Don’t Trust Yourself – Credit cards report information to the major credit bureaus every month even when you don’t make any purchases. And while you may build credit faster by making purchases and paying them off by the end of the month, overspending and missing payments is counterproductive.
    So if you don’t trust yourself to spend responsibly with plastic, give your card to your parents for safekeeping. You could even cut it up. Just make sure to save your account number in case you need to call customer service.


  1. Make a Budget – If you combine credit card use with a well-defined budget while in college, you’ll be well ahead of the curve. Only two in five consumers have a budget, according to the National Foundation for Credit Counseling, and that’s one of the main reasons why credit card debt levels are so high.To learn how to take this important step, check out WalletHub’s step-by-step guide on how to make a great budget.
  2. Take Advantage of Campus Resources – Most colleges and universities offer financial literacy resources of some sort. For example, there might be a personal finance class you can take, a money-management help center you can visit or online educational materials to peruse. Find out and soak up as much information as you can, especially if it will fulfill a curriculum requirement. Because unlike much of what you’ll learn in college, financial skills translate directly to everyday life.
  3. Approach Student Loans with Caution – Taking out a bunch of student loans might not seem like a big deal now, considering how long you’ll have to pay them off. But too few students truly consider how big of a burden they can wind up being. Student debt increases the pressure to find a job and can delay major life events such as buying a home, getting married or starting a family.
    No one wants to be paying off education debt into their 40s, which is all too common these days. So try to supplement your tuition money with scholarships, grants and work experience. This will also give your resume a boost.
  4. Improve Your Financial Literacy – Understanding how to manage money is an invaluable life skill. And you probably won’t learn much about in school. So you’ll have to take things into your own hands. To get a sense of your current knowledge level and the areas where you can improve the most, get your WalletLiteracy Score.