Credit Card Quick

Smart Financial Advice for College Students

Introduction

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.

College Students: Easy Ways to Begin Building your Credit Now!

Credit Score

The college years are filled with excitement and optimism, yet they can also be riddled with uncertainty about life after college. It is therefore of the utmost importance to start thinking about life beyond college, even if you’re still a freshman!

In particular, it is vital that you begin working to establish a strong credit history so that you can begin your life after college with a good FICO score in your back pocket. After all, your ability to obtain a car loan, a home loan or even a good job relies on a strong credit score.

How to Start Working toward a Great Credit Score while you’re still in College:

a)      Jump onto your parent’s credit card. If your parents are good with their credit, and if you are ready to take on the responsibility of a credit card, you may want consider asking your parents if they can add you to their credit card account as an authorized user. This is often a great way to begin establishing your credit history, and is a solution to the tight restrictions due to be placed on student credit cards as a result of the new credit card legislation.

b)      Ask your local bank or credit union if they provide student credit cards. Although these types of cards typically come with a low limit and a higher APR, they are still the ideal way to begin building your credit history. This is not the time, however, to get yourself into credit card debt. Make a point to purchase only needed items, and to also pay off your balance in full, every month, without exception.

c)       Consider a secured credit card if options A and B aren’t possible. Secured credit cards require a cash deposit equal to your credit limit, so that the bank will be protected in case of your failure to pay. However, they are also a practical way to build your credit history. Then, once you have established a strong credit history you can move to a standard credit card.

The Top Five Tips to Remember about your Student Credit Card

Choosing Credit Card

A student credit card is often a great way for a college-age student to begin working toward a positive credit score. However, it is also a time when many students mismanage their credit cards and end up not only putting themselves in debt, even before they graduate, but also ruining their credit score in the process.

It is therefore important to remember that your student credit card comes with its own set of perks, as well as responsibilities. The following, five tips will help guide you as you begin to build a healthy relationship with credit cards.

1. Look for a student credit card that offers no annual fee and competitive interest rates. It is a common misconception that you must pay high fees and interest rates with your first credit card. Although you may not be eligible for the lowest interest rates, as they are generally reserved for consumers with a long credit history, you can definitely shop around and find a competitive interest rate to suit your needs and budget.
2. Look for a student credit card that is designed specifically for college students, as these types of credit cards often offer incentives and rewards when the cardholder uses his/her credit in a responsible manner.
3. Look for a student credit card with rewards. For example, you can earn rewards for free gasoline and free airline tickets. Some creditors even offer rebates or cash back rewards for maintaining a good GPA!
4. Always consider your needs and wants before making a purchase. Although this can be a hard habit to get into, it is important to take a step back before making a purchase to ask yourself if your purchase is a need or a want. Often times, using this approach can stop you from overspending and getting yourself into a situation where you are faced with high debt and no way of paying it.
5. Be aware and educate yourself on the new credit card legislation that is set to begin in February 2010, as there are specific laws that will affect who – and who cannot – can get student credit cards.