Smart Financial Advice for College Students
We all know that establishing a strong credit score first begins with being able to establish credit. And with the new onslaught of credit card laws, many students may be left in a precarious position of not being able to secure a credit card to begin establishing credit.
Under the new credit card laws, a college student must be able to prove his or her ability to pay on the card. In other words, if you don’t have a job, you can forget about securing a credit card.
However, even if you are able to secure a credit card, it certainly doesn’t mean that you should have one. If you are not ready to be financially responsible, simply avoid credit cards for the time being. Otherwise, you could find yourself in a big financial mess, even before you graduate from college.
For the remaining college students who want a credit card and are able to afford a credit card, there are a number of things that should be considered:
- Search for the credit card that features the best terms and conditions. Now is not the time to search for rewards and airline cards; instead, concentrate on finding a student credit card that offers competitive terms and conditions.
- Always – pay your bill on time. There is nothing that could damage your newly found credit faster than not paying your bill on time. And don’t forget about your cell phone or rent, either, as these could also negatively affect your credit if you fail to pay them on time.
- Avoid retail credit cards, as they often come laden with high interest rates and fees. In addition, many consumers are far more likely to overspend in their favorite retail store if they have a store credit card. Your best bet? Skip the store credit cards and stick with one, major credit card for purchases.
- Make a conscious effort to only charge what you can reasonably pay off within a month or two. Credit card debt is sneaky, as the balance can creep up on us and, before we know it, we are faced with a high debt that we simply can’t pay down.
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