College Credit Cards

Heading off to college is an exciting time to learn and grow but academic pressure, social life, and money can cause some real stress for students.

To combat money worries students rely heavily on college credit cards without truly understanding the danger of carrying revolving debt and compound interest.

College students are easy prey for credit card solicitors and it’s no surprise that at age 18 the offers start pouring through the mail.

Without the proper knowledge of credit, they sign up for credit cards, get the free T-shirts, low introductory APR, and open themselves up to years of debt if they are not careful.

So how can a student better manage his or her college credit cards?

The first step is to set some guidelines on how you plan to use the card and for what purpose.  Will the card be used for emergencies only or for food, entertainment, gas and shopping?

It’s easy to pile up the credit card debt from buying on impulse especially when you don’t have a clear set of rules established for yourself.

Secondly, set a monthly budget and stick to it no matter what. By establishing a budget you not only prevent yourself from accumulating revolving debt but also set a good habit for managing your finances in the future.

Finally, understand the terms and conditions for the college credit cards you have. Even though you may have applied for that credit card because you wanted that free beach towel, now is the time to see how much that towel is really costing you.

For example, if you received a 0% APR credit card introductory offer you should know the exact date when the APR will increase, more importantly how much will it increase.

If you’re a college student who has already accumulated credit card debt you should definitely start paying it down immediately. You can start with something as simple as paying more than the minimum payment each month. You will be surprised at what an extra $25 or $50 per month can do.

Another option is to use a balance transfer credit card and transfer your revolving debt from a high interest rate card to a lower or even 0% APR credit card. Make sure you find out if there are any hidden fees for a balance transfer.

It’s important for college students to build credit history as long as they are using credit responsibly by making timely monthly payments and keeping revolving debts low.

College students can better manage their college credit cards when the proper guidelines are set, a budget is in place, and they understand the terms of their credit card agreements.

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About the author

Marco Carbajo is a business credit expert, author, speaker, and founder of the Business Credit Insiders Circle. He is a business credit blogger for AllBusiness, a subsidiary of Dun and Bradstreet and author of “Eight Steps to Ultimate Business Credit” and “How to Build Business Credit with No Personal Guarantee.” His articles and blogs have also been featured in the SBA Community, American Express Small Business, Business Week, The Washington Post, The San Francisco Tribune, Scotsman Guide, Alltop, Entrepreneur Connect, and Active Rain.