Capital One Journey vs. The Discover it for Students
It’s vital that college students build their credit history while learning sound practices for managing credit cards. Thankfully, there are a number of credit card issuers that offer products specifically for students to achieve these goals. The Capital One Journey and the Discover it for Students are two of the leading student credit cards. Let’s see how they compare:
The Capital One Journey card gives students the opportunity to build their credit while earning some cash back. Cardholders receive 1% cash back on all purchases, plus an additional 25% bonus on the cash back earned each month when cardholders pay on-time.
Customers begin with a modest credit line, but are eligible to receive a larger credit line with the Credit Steps program after making their first five payment on-time. Other benefits include access to Capital One’s Credit Tracker app which includes a free monthly credit score, and a what-if simulator to let you monitor your credit and predict where it is going.
Capital One cards come with other features such as 24-hour travel assistance services, extended warranty coverage, and auto rental insurance. Cardholders can also set up free account alerts via text, email, and phone. The standard interest rate for purchases is 19.8% APR, and there is no foreign transaction fee or annual fee for this card.
The Discover it for Students offers young cardholders some rewards and benefits of the standard Discover it card. Cardholders earn 5% cash back on up to $1,500 spent each quarter at featured categories of merchants, and 1% cash back on all other purchases. Points can be redeemed at any time and for any amount as statement credits, direct deposits, or even for purchases at Amazon.com.
Furthermore, Discover has a limited time offer that is valid on all accounts opened before July 31st, where it will double all of the cash back earned throughout the year. So long as cardholders keep their accounts open and in good standing, they will have all the rewards earned after one year doubled.
The Discover card also offers a host of other features such as automatically waiving cardholder’s first late payment fee, having no penalty interest rate, and 100% US-based customer service. In addition, Discover offers customers a free FICO credit score each month on their statements, online, and on their mobile app. Finally, the Discover it card offers the Freeze It feature which works like an on/off switch when you need to pause the ability to make new purchases for any reason, such as if your card has been misplaced, or if you just want to take a break from credit card use.
Other standard cardholder benefits include a purchase protection policy, extended product warranty coverage, return guarantee protection, and price protection. When traveling, cardholders receive baggage delay insurance, 24/7 travel assistance, and an emergency roadside assistance program that charges $69.95 per service.
New cardholders receive six months of interest free financing on new purchases, followed by a standard interest rate of 12.99%-21.99%, depending on their credit worthiness when they applied. There is no annual fee for this card, and no foreign transaction fees.
Choosing the right card for your needs
The Capital One Journey card features a very simple rewards program that even provides an additional incentive for making on-time payments. The Capital One offer also stands out because it features an automatic credit limit increase after you make on-time payments for your first five months as a cardholder. In addition, Capital One is part of the Visa network, which is more widely accepted overseas than Discover. While college students might not be regular international travelers, this can be an important feature for those who study abroad, or just take a backpacking trip over the summer.
The main advantages of the Discover it card are the ability to earn as much as 5% cash back, as well as its customer friendly policies. The Discover card is widely regarded as having excellent customer service, and cardholders tend to rave about how well they are treated. But beyond those subjective impressions, Discover tied for the highest rank in JD Power’s 2014 Customer Satisfaction Survey. And it backs up these achievements by not having a penalty interest rate and automatically waiving cardholder’s first late fee. While most card issuers will waive a late fee upon request, customers will typically have to make the uncomfortable telephone call to request it. Finally, six months of interest free financing can be very valuable, so long as cardholders do use this feature to save a little on interest, and not as a way of incurring more debt.
College students and their parents should be very careful to choose the best credit card for their needs and use it responsibly. By considering both the Capital One Journey vs. The Discover it for Students, they can choose from two of the best cards available.