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College Students Beware of Credit Card Deals that Seem to Good to Be True!
If you are a college student then you probably have two things going for you after you graduate from school. You have a diploma, which is a good thing and will help you further your career and get a higher paying job. You also probably have a huge amount of debt, which is a bad thing and you will need that high paying job to pay it off!
With tuition rates increasing at unbelievable rates in recent years it is easy to see how college students can fall behind in college payments. But beyond just tuition debt, college students are becoming more prone then ever to credit card debt!
Credit card companies love targeting college students with student credit card offers because obviously these young ones have yet to build a credit history- good or bad. Credit card companies can be seen on campuses nationwide passing out credit card applications because the sooner they can get these spend-happy students outfitted with credit cards the better. As a college student, if you can graduate with less then $5000 dollars in credit card debt you are off to a good start!
Credit what?!
The biggest problem for students consists of understanding how credit cards work. Even though there are hundreds of options when it comes to student credit cards, most college students don't understand how they work. Credit cards are not free money! When you make a transaction with your card it doesn't come out of an account automatically (like a bank card) but that doesn't mean you are getting something for free, it just means you will have to pay it off at a later date.
Many college students confuse their credit card with their debit card and they don't see the concept of paying it off at the end of the month. Sure, your credit card may look identical to your debit card and it probably feels the same in your hand but it is used entirely different!
Good and bad considering credit card usage
Credit cards help many students with their financial lives and help them conveniently purchase items without the need of cash or bank cards. But a credit card- even the best credit card- is only as useful as the person using it! These pieces of plastic are easily abused and you can get yourself in a lot of trouble quickly if you forget to pay it at the end of the month or if you exceed your credit limit on a consistent basis.
Students are basically starting from scratch when it comes to building credit and if you start off with a bad credit history you are going to have a hard time in the future getting loans, cars and homes. If you take care of your credit score, you will be able to make online purchases, over the phone purchases and in store transactions easier then ever without worry!
If you are new to credit card deals then you may get carried away with the financial freedom you have. Spend-happy students are especially prone to getting out of control when it comes to buying things. If you remember one thing, remember that your credit card is not equal to free money. You will have to pay eventually- either now or down the road!
Having a great credit history is important
Credit cards are a great way to improve your credit history and your overall credit score. Credit scores range between 350 and 850, so the higher you can get yours the better. If you are a student you can start building your credit score quickly by keeping a credit card in your wallet and by using it responsibly.
Many students make the mistake of not building up a credit history at all by the time they graduate college which means that they will have trouble getting loans or financial help from any institution. At the same time, no credit is better then bad credit. If you cannot use a credit card wisely then it is wise to not even get a card in the first place. If you ruin your credit bad enough it will take years to recover.
No fee? Non existent!
There is no such thing as a top credit card deal with any fees. Fees are the costs that are involved with your credit card and some of these are: annual fees, balance transfer fees, interest fees and over-draft fees. You may be able to get one of the best credit cards with no annual fee or with 0% balance transfer fees but you can't expect any card to be fee free.
The typical student card is pretty low in fees and doesn't come with an annual fee but you should still read the fine print and make sure this is the case with your card. Reading the fine print on your credit card application will give you a better idea of the type of card you are dealing with and what it entails.
Tips for using your student credit card
Don't take this article as a negative about using credit cards as a college student because they are a useful tool that is almost needed to improve your credit score. The only thing is you have to be careful in the way you use your credit cards. Here are a few tips to help you along the way:
- Don't impulse shop with your card- it only spells trouble!
- Pay your bills on time and in full. Carrying a large balance is bad for your credit and can get you in deep financial trouble quickly!
- Use your credit card only for emergency situations.
- Don't carry all of your credit cards on you all the time. If you have more then one student credit card, only carry the ones you plan on using. If you carry more cards you will have a bigger tendency to spend more!
If you have something to say, please leave your comments below.
Articles about credit cards
The subject of credit card use by young adults is much talked about online and offline, in magazine and internet articles. There are supporters and opponents of issuing plastics to young people among credit consumers and financial experts. However, many of those hair-raising tales about graduates that collect enormous debts are just boogieman stories. The statistics shows that young people became more reasonable in credit card management and most of them do not have loads of debts.
A recent opinion poll conducted among college students revealed that 92% of young adults realize that damage credit history and low credit score could have a negative effect on their future financial standing and cause problems with qualifying for loans.
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Financial crisis, mortgage and credit crisis, real estate crisis, what other crises do US citizens have to suffer from? It is just some epidemic of crises! Talking about epidemic, health insurance crisis is another hardship Americans are going through. Medical services take a bite out of your wallet. This year, according to recent surveys, Americans healthcare expenses exceed last year's medical spending by nearly $1,500.
The thing is that insurance companies have significantly raised healthcare insurance costs for customers. Many people just cannot afford paying for medical insurance. The government understands that many citizens' financial standing has shattered due to the economy recession. And the authorities do not stay indifferent to people's problems. They try to find an alternative solution.
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Have you ever noticed that all credit cards in circulation look the same except the color and picture on the front? The common features are size, shape, the magnetic stripe, the signature stripe, hologram and the number emblazoned across the front. Many people are so used to the standard credit card design that they don't pay attention to these physical characteristics. If you want to know why all plastics from different American issuers share the same structural features, read our article. We will tell you 10 interesting facts that cover their technology.
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12:27 AM, August 24, 2007, Jess
I graduated from college 2 years ago and I guess I was very lucky, because my credit card debt was much less than 5000$. The reason for that is that I always tried to pay in cash and used my credit card very rarely, in case of emergency. In college I saw too many ppl waisting money from their credit card accounts! And then after the graduation were very surprised why do they have such a huge debt! Trust me, this irresponsibility causes a lot of trouble!
04:44 AM, September 13, 2007, Ruth
Some students can't realize up to the end that having a credit card is very responsible. Maybe there should be some consulting service for students where they will be told about the pros and cons of credit cards.