Yearly financial surveys reveal the fact that many students are confronted with the dilemma of bad debt. One huge factor that is known to have led these young people to bad debt is uncontrolled credit card spending. If you are a student yourself who owns a credit card, what can you do to avoid the college debt trap? Below are important points for you to ponder:
Points to Ponder when Acquiring a Credit Card for Students
Remember your payment due dates. Remembering your due dates of payment is crucial for staying away from bad credit. College credit cards are often accompanied with expensive late penalty fees plus the high interest rates. Avoiding these extra charges can make a big difference in your finances.
Pay off your balance completely. To avoid the additional interest rate, every student with a credit card must make it a goal to pay off her/his full balance each month. In order to do this, be sure that you only use your credit card for expenses that you can afford to pay back in full.
Choose a due date that suits you. Most credit cards set the deadline of payment at the end of the month. However, you can make arrangements with your student credit card issuer to move your due date of payment to the time of the month most applicable for you. For instance, if you receive your allowance during the first week of each month, you may want to request for your due date to be nearest to this time so you can pay off all your balances right away before your allowance is spent.
Take advantage of your student credit cards online banking feature. Most credit cards for student have the online banking feature which means you can pay your bills through the internet. This means there is no need for you to personally visit your bank to submit your payments. Thus, even if you’re busy with your school activities, you can conveniently send in your payments on time through online banking.
Do not maximize your credit limit. It doesn’t matter whether you’re student credit card offers you a very low rate or a zero interest rate. Even if this is true in your case, it’s best to impose your own limit to your spending. Even with a low rate card, see to it that you will keep your spending in control and that you will not go over 40% of your credit line to avoid bad debt.
About the Author
Samantha Wilson is a consultant for credit cards for students. For years she has written student credit card articles that would help build student credit.