Q: What is difference between a student credit card and a secured credit card?

A: Student Credit Card is a marketing term that a lender may use to attract young people and parents, but it has no real meaning. A credit card marketed as a Student Credit Card could also be a secured credit card requiring a deposit. Cards targeting young people often carry high interest rates and fees.

Secured Credit Cards require the account holder to make a deposit into a savings account that will be held by the credit card issuer as collateral against the use of the credit card. The account's credit limit usually equals the deposit amount. Secured Credit Cards often carry high annual fees and sometimes monthly fees just to carry the card. They typically carry higher interest rates, so it is smart to shop around for a card with lower fees.

Mike Schiano is the author of “Spend Your Way to Wealth.” Check out his weekly radio show at youngmoney/radio.com.

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