According to a study done by the US General Accounting Office in 2001, credit cards are very helpful for college students, especially when they need to pay for medical emergencies, travel, or buy things without cash. Another study found that 77 percent of college students who have credit cards use them for personal expenses and 67 percent use them for occasional and emergency costs.
Given these results, do you think it's strange that college students can apply for credit cards even if they don't have jobs yet? Well, we shouldn't forget that it's these students' job to take care of their money. Even if they don't make as much as they spend, they must care about the work that goes into these.
And for college students who want credit cards or already use them, here are some tips on how to handle your credit wisely:
First, you need to know that every amount you add to your balance needs to be paid by the due date or before to avoid fees. So, learn to be in charge of your account so you don't end up paying for things you did when you were seventeen even though you are thirty years old. Seems like a lot? So, it really could happen. Don't let this bad luck get in the way of your plans.
Look over the terms and conditions of the credit card you already have or the one you want to get. You should know that the things you buy with a credit card don't cost you nothing. You do have to pay extra fees on top of the main amount you spent on shopping. Some of the fees are interest charges, fees based on the annual percentage rate, fees for cash advances, and fees for paying late. Each month, the finance charges are added to the account that hasn't been paid. The annual percentage rate (APR) is the fee that the credit card company charges for membership each year. If you want to get a credit card, you should look for one with a low APR. And the late payment fee is the charge you have to pay if you don't pay by the due date.
When your parents give you money for your credit card payments, like an allowance, make sure to pay off your bills right away. Your monthly bill can go up if you don't pay on time or don't pay it all. And if this keeps happening, you'll find it harder and harder to pay back your debts. The problem doesn't end here, though, because the credit report will show up on your credit history. You don't want a bad credit history when you try to get a job after you graduate. Employers should check a person's credit history before they hire them or give them a promotion. You definitely need to prove yourself, and the best way to do that is with your good credit name.
Take care of your credit. Don't shop as if it were the last time you would ever go shopping. Figure out what's most important to you and what you really need. And since credit cards for college students are mostly meant to help you out in times of trouble, don't use it too much for things you don't need.
And finally, show that you deserve trust. When you were given a credit card, the company that gave it to you thought you could handle the responsibility. So be smart with money. Think about what this will mean for you in the long run.
