JumpStart Jr. is about to turn 18, and I have been curious about how difficult approval for his first credit card will be. He has a job and a couple of years of tax returns, but at age 17, he doesn’t even have a credit score. After some searching, Bank of America had a few cards under their build/rebuild credit category. There were a couple of cards with the word student in the title, and one with secured in the title. I read the descriptions and chose our target:
The Bank of America Travel Rewards Credit Card for Students.
- 1.5 points per dollar spent and points never expire.
- Free Fica score check.
- No annual fee and no foreign transaction fees.
- 20,000 bonus points after 1,000 dollar spend in the first 90 days.
I was pretty excited after reading the details, because I feared we might need to start with a secured card and no bonus. I have a big 6 month car insurance bill coming up, and depending on his credit limit, 1000$ in spending could be knocked out in one shot.
Assuming approval of the card, spend of 1000$, and the new card bonus, JumpStart Jr. will earn 21,500 Bank of America travel points that can be redeemed for $215 in travel. This will be a first step in establishing a customer relationship with Bank or America. No annual fee cards are great, because they can be left open permanently. Average age of credit card accounts is a factor in credit score and a few no fee credit cards contribute to a high credit score once they have matured.
Some people might say that exposing a young adult to credit card temptation is a dangerous game. Responsible credit card use is a learned habit. We intend for him to continue using his debit card for everyday spend. The $100/month spend volume he generates is not enough to worry about credit card rewards. Whenever there are some larger purchases like textbooks, we’ll consider using this credit card, or getting some new cards with bonuses. A credit card should never be used to buy things that you could not currently pay cash for. If balances are not paid in full each month and interest must be paid to the bank, you will lose at this game. If you do not have the cash flow or discipline, do not open credit cards.
I’ll report on the results of his application as soon as we find out the results. If you are interested in this particular card, the link is here.