Student Credit Cards: 101
Contributed by Nicole
Student Credit Card:101
Student credit card offers are a fixture on many college campuses around the country. Wide gleaming eyes, excited by the lure of the pocket sized pieces of plastic. The literature explaining the APR and penalties for over charging their account is barely read. Students jump right into the credit pool without the life jacket of understanding the depth and girth of using a credit card frivolously. Credit card companies offer student credit cards like candy and 18 year olds can hardly resist such a sweet temptation of what they may consider "free money"
Student credit cards are not free money
Student credit cards are practical, but they should only be used in emergencies (pizza isn't an emergency). Otherwise they're paying high premiums on everyday purchases. In return they are running the risk of damaged credit, and learning some bad credit habits at a young age. I can't emphasize enough that all students should remember that a credit card is a stepping stone to building a solid credit history.
Understanding Student credit cards
It is estimated that the average college undergrad currently has more than 1,000 dollar balance on their student credit cards - direct outcome of not understanding the importance of credit,and the impact it can have in the future. Renting an apartment and buying a car requires a good credit rating. Misusing their credit cards can add a stain on their credit records that will take years to erase.
Student credit cards are not free passes
Student credit cards are not passes for unlimited shopping sprees. Financial research has shown that people tend to spend less when they make a cash purchase, compared with a credit card. It's something about the plastic card that says, "buy whatever you want, it's not your money, after all". To young people, especially students who's funds are already limited, this is appealing.
