Best Credit Cards for Students in New Zealand
As a student in New Zealand, managing your finances can be challenging. A credit card can be a useful tool for building credit history and managing expenses, but it’s crucial to choose the right one. This article explores the best credit card options for students in New Zealand, highlighting their features, benefits, and potential drawbacks.
Why Consider a Student Credit Card?
Before diving into specific card recommendations, it’s important to understand why a student might consider getting a credit card:
- Building Credit History: Establishing a good credit score early can be beneficial for future financial endeavours.
- Emergency Funds: A credit card can provide a safety net for unexpected expenses.
- Budgeting Tool: With proper use, a credit card can help track spending and manage a budget.
- Rewards and Benefits: Some student cards offer perks like cashback or travel points.
However, it’s crucial to remember that credit cards come with responsibilities. Always aim to pay off the full balance each month to avoid high interest charges.
Top Student Credit Cards in New Zealand
1. ANZ Student Visa Card
The ANZ Student Visa is a popular choice among New Zealand students.
Key Features:
- Low annual fee of $15
- Interest rate of 20.95% p.a. on purchases
- Up to 55 days interest-free on purchases
- Minimum credit limit of $500
Pros:
- Low annual fee
- Suitable for students with no credit history
- Access to ANZ’s mobile banking app for easy management
Cons:
- Higher interest rate compared to some other options
2. ASB Visa Light
While not specifically marketed as a student card, the ASB Visa Light is an excellent option for students due to its low fees and interest rate.
Key Features:
- No annual fee
- Low interest rate of 13.50% p.a. on purchases
- Up to 55 days interest-free on purchases
- Minimum credit limit of $1,000
Pros:
- No annual fee
- Low interest rate
- Good for students who might carry a balance occasionally
Cons:
- Higher minimum credit limit, which might not be suitable for all students
3. Westpac Debit Plus Visa
This is not a credit card but a debit card with credit card functionality, making it a safer option for students concerned about overspending.
Key Features:
- No annual fee
- No interest charges as it uses your own money
- Visa payWave for contactless payments
- Access to Westpac’s CashNav app for budgeting
Pros:
- No risk of debt accumulation
- No fees for everyday use
- Helps with budgeting
Cons:
- Doesn’t help build credit history
- No rewards programme
4. American Express Airpoints Card
For students who travel frequently, the American Express Airpoints Card offers good value.
Key Features:
- No annual fee
- Earn 1 Airpoints Dollar for every $100 spent
- Complimentary travel insurance
Pros:
- No annual fee
- Earn Airpoints on purchases
- Travel benefits
Cons:
- Higher minimum income requirement, which might not suit all students
- American Express is not as widely accepted as Visa or Mastercard in New Zealand
Things to Consider Before Applying
Before applying for a student credit card, consider the following:
- Income Requirements: Most credit cards have minimum income requirements. Ensure you meet these before applying.
- Credit History: If you have no credit history, you may need to start with a secured credit card or a card with a low credit limit.
- Fees: Look at all fees associated with the card, including annual fees, late payment fees, and foreign transaction fees.
- Interest Rates: While you should aim to pay off your balance in full each month, knowing the interest rate is important in case you need to carry a balance.
- Rewards: While rewards can be attractive, they shouldn’t be the primary factor in choosing a card. Focus on low fees and interest rates first.
Responsible Credit Card Use for Students
Having a credit card as a student is a big responsibility. Here are some tips for using your credit card wisely:
- Pay Your Balance in Full: Always aim to pay your full balance each month to avoid interest charges.
- Stay Within Your Credit Limit: Exceeding your limit can result in fees and negatively impact your credit score.
- Use for Necessities: Avoid using your credit card for unnecessary purchases.
- Monitor Your Spending: Regularly check your credit card statements to track your spending.
- Protect Your Information: Keep your credit card information secure to prevent fraud.
Choosing the right credit card as a student in New Zealand depends on your individual needs and financial situation. The ANZ Student Visa and ASB Visa Light offer good options for most students, with low fees and reasonable interest rates. For those who prefer to avoid credit altogether, the Westpac Debit Plus Visa provides a safe alternative.
Remember, a credit card is a financial tool that, when used responsibly, can help you build a good credit history and manage your finances effectively. However, it’s crucial to understand the terms and conditions of your card and use it wisely to avoid falling into debt.
Before applying for any credit card, carefully consider your needs and financial situation. If you’re unsure, seek advice from your bank or a financial advisor. With the right approach, a student credit card can be a stepping stone to a healthy financial future.