A complete and detailed guide on the BEST credit cards for students in Germany.
Credit cards are such an important financial tool. Therefore getting a credit card should be a priority if you have recently moved to Germany. A credit card will be useful regardless of whether you are a student or a working professional in Germany. So I will be recommending you THREE of the BEST Credit Cards that you can get in Germany as a student. I personally have used these credit cards so you can take my word for it!
Advantages of having a Credit Card in Germany
- Helps you manage your money better : Credit cards will be a blessing in your day to day life. When you make purchases with a credit card, you do not have to pay right away. You can settle all your credit card bills at once. Also, by paying the bills within the due date you will be avoiding any interest payments. This helps you keep your cash flow very organised.
- Emergency Funds : Having a credit card means you will always have access to a source for some emergency funds. This way, you do not have to take money out of your personal savings when there is a quick need for some cash!
- Build up a good credit score : your credit history is full of timely payments such as your credit card dues, your credit score will increase. This comes in handy in times you need to apply for loans in the future.
So we saw why having a Credit card can be useful. Now we move on to finding out the best credit cards for students in Germany. There are several options available, but how do we decide which Credit cards are the BEST?
By setting a few parameters.
Parameters of the Best Credit Cards for Students in Germany
Firstly, setting parameters is important because we can then filter out the options that do not fit our needs. For example, a good quality credit card needs to be accessible for a student in Germany. This is why we set FOUR key parameters that makes a credit card the BEST option for students in Germany.
1. No Monthly Fees
We will look at Credit Cards that are FREE OF COST.
This will help us narrow down our options much better. As a student, it really does not make sense to be paying monthly fees to credit card companies. There are a good number of options for a free credit card in Germany, but free usually means there is going to be charges in other areas. This is why it is important that you read this article thoroughly.
2. No FOREX Fees
For students, it is necessary to cut-down costs wherever possible. Therefore, we want to narrow our options to those Credit Cards that do not charge any FOREX Fees.
This comes in handy especially when you are visiting a foreign country with a different currency. For example, with your student visa you can travel to countries like Turkey, Denmark, UK etc. When you are purchasing in these countries through a credit card, you will essentially be paying foreign currency fees. That is why you need to look out for the free/lowest cost on foreign transactions.
3. No Withdrawal Fees
I consider withdrawal fees as the worst type of fees. Because, it is a fee you are paying to withdraw money that belongs to you! I try to keep my cash transactions at the very least exactly because of this. However, you sometimes need cash to make a few transactions and there is no two ways around that. So in order to minimise the expenses during withdrawal, we look for the cheapest option.
4. Rewards and other benefits
Benefits and rewards are usually in the form of Sign Up Bonuses, Cashback on payments, travel benefits, vouchers etc. Hence we look out for these rewards as much as possible.
Now that we have looked at the parameters, we proceed to discussing about the best credit cards in more detail.
Here are the BEST Credit Cards for Students in Germany !
1. Advanzia Gold Mastercard (Gebuhenfrei Mastercard Gold)
This is my first pick out of the BEST Credit Cards for Students in Germany
Advanzia issues the Gebuhenfrei Mastercard Gold in Germany. Gebuhenfrei Mastercard literally transaltes to Free of Charge Mastercard. That pretty much sums up the benefits of this card!
Let us get into more detail. Here are the features of the Advanzia Gebuhenfrei Mastercard Gold:
a) No Yearly Fee – A Yearly fee or Annual Fee is a fee that you sometimes have to pay to the issuer so that you can remain as a cardholder. However, there is NO YEARLY FEE with the Advanzia Gebuhenfrei Mastercard Gold. Even applying for the card does not cost you anything, so it is a great feature!
b) Foreign Currency Transaction Fee : When you make a purchase in a foreign region that uses a different currency than your country, you will be charged a foregin currency transaction fee. With this card however, there is no such fee charged whatsoever.
c) ATM Withdrawal Fee : Again, absolutely free of cost. You can withdraw ATMs from across the world without paying a fee on it, but you have to keep in mind that from the moment you withdraw money, you will be charged a percentage fee. For Advanzia this fee stands at an annual fee of 19.44% !
So, I would not take out the money with your credit card, unless absolutely necessary, because it comes with extra cost.
d) Benefits and Rewards : Upto 7 weeks of interest-free payment, Free 24 hours Customer Service, 5% travel credit, 5% reimbursement on rental cars.
2. AMEX Payback
Features of AMEX Payback Credit Cards :
- No Yearly Fee : Similar to Advanzia, the AMEX Payback Card does not include any monthly or annual fee. So this card qualifies as a FREE Credit Card making its way into our shortlist.
- FOREX Fee : On the other hand, AMEX Payback does have a 2 % charge on FOREX transactions. So I would advise against using this card outside Germany.
- Withdrawal Fee : This card is really not suitable for withdrawals too, as there is a 4% ATM fee on cash withdrawals.
- Benefits and Rewards : The best part of having an AMEX Payback card is the benefits and rewards that come with it. For instance, Payback Loyalty Points.
Payback Loyalty Points – It does not matter if the money is spent at a partner company or not, you will recieve 1 Payback Loyalty point for every 2 Euros spent. 100 Loyalty points are worth 1 €. The best aspect of this whole cashback feature is that you are able to conver these points into money and transfer it to your Girokonto / Current Account.
You can also get free shipping on qualified purchases. AMEX also has high quality customer service which is a good benefit.
3. Amazon Prime Visa
Amazon Prime has its own credit card in Germany! However, you need to have a prime membership to sign up for this card. This is why I have kept this as a last pick.
Features of Amazon Prime Visa Card :
- Yearly Fee : Amazon Prime Visa is technically FREE of charge, but only for those with an Amazon Prime Membership. Without a Prime Membership, you will have to pay 20€ per year.
- Forex Fee : Similar to AMEX Payback, there is a forex fee. This fee stands at 1.75%. I would not suggest using this card for Forex transactions
- Withdrawal Fee : There is a 3% withdrawal fee charged and the minimum amount for withdrawal is 7,50€. I would not advise you to use this card for cash withdrawals too.
- Benefits and Rewards : 3% off on ANY purchase on Amazon with this card. 0.5 % cashback converted into Amazon points.
In Conclusion – Best Credit Cards for Students in Germany
As I mentioned above, I personally have used all these cards myself. So let me give you my conclusion on which is the best.
Advanzia clearly trumps AMEX & Amazon Visa cards in all areas. It is quite clearly the best credit card for students in Germany. AMEX Payback and Amazon Visa have Forex fees and withdrawal fees which are not desirable at all.
For instance, we do not get the reward points with Advanzia Mastercard. Amazon card has 3 % off on all Amazon purchases which is a very good deal.
So, my suggestion is to simply get all these cards! They are FREE to sign up for, with the exception of not having a Prime Membership. And by using all the cards interchangably, you can manage your money even better.
It does not make sense to single out one of these options and decide that it is the ONLY best credit card to use in Germany. Credit Cards are multi-functional. And you should make your decisions based on the context in which you use the card. I have explained it in the following video too!
Do you prefer to watch a video on this instead? Check out the detailed comparison on my YouTube channel.
