Many colleges and universities allow students to use cash back credit cards to make payment for their tuition fees. Both public and private colleges will accept credit card payments from a variety of credit cards including Visa, MasterCard, Discover and American Express. Since semester tuition fee usually costs a few thousands dollar, you will be able to earn a lot of cash back by using your cash back credit card to make payment for your tuition fees. For example, if your college tuition fee is $10,000 and the cash back is 2%, you will be able to earn a cash back worth $200.
Even though paying your tuition fees with credit card can earn cash back rewards, there are a few things to take into account. One of the concerns is that many colleges charge a convenience fee for credit card payment of the tuition fees. The college does not profit on the charging the convenience fee as it is often charged as a separate fee that goes towards the credit card company.
The reason why the colleges charge a convenience fee is that they want to cover the swipe fee. The convenience fee is about 2 – 4% of your tuition fee. So, if you plan on paying your tuition fee with a cash back card to earn cash back, you must make sure that your college does not charge a convenience fee.
You can find out whether they charge a convenience fee by visiting the website of the college or ask the staff at the bursar office. There are 18 colleges in the USA that does not charge convenience fees. Some of the colleges that waive the convenience fees are Auburn University, Hampton University, Middle Tennessee State University, The University of Alabama and Robert Morris University.
It is important that you don’t rely on the cash back credit card to fund your college tuition fee. You must be able to pay back the balance in a single billing cycle after using it to pay for your tuition fee. If you pay month by month, you will be charged with interest fees so that cash back you earn is useless. The average interest rate charged on a credit card is about 15 – 25% so it is going to be expensive if you roll over your bill payment from month to month.
Paying your balance in full at the end of the month can help to raise your credit score since most credit card companies will report your payment activities to the credit bureau. Besides, you must not max out your credit card by using all the available balance to pay the tuition fee. This is because it will increase your credit utilization ratio and cause a drop in your credit score.
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