If you’re a new international student, just beginning your first year at a US college you might be surprised by the number of banks advertising student credit cards. Many of them will try to entice you with what look like great low-interest rate cards or they may even give you free stuff – but proceed with caution.
Even if there’s nothing (such as a lack of credit history or small income) standing in your way of getting your very own US credit card, it doesn’t mean you should. In fact, when asked what tips they would give international students regarding credit cards, most student advisers and advice columnists would agree on the #1 best tip: don’t get one.
It’s wise but tough advice especially when credit card companies are setting up booths on your campus offering free t-sheets for completing an application.
Still, if you really really want one there are international students who successfully open credit cards without running into debt. It’s all about research and proper money management. So if you’re an international student intent on getting a US credit card, just make sure you follow these 3 bits of advice:
1. Know What You’re Getting Into
There are a lot of banks and credit card companies out there for you to choose from so make sure you do your research on each one before making your final decision. Visit the banks in person and speak with representatives.
Make sure you learn the answers to important questions such as whether or not you can expect your interest rates to increase over time and what the penalty is for not paying your bill on time.
It’s also important that you select a card with no annual fees – students have many free options so don’t be tricked into thinking otherwise. Some cards also come with rewards, such as money towards gas or groceries. These types of deals can be helpful, as long as there aren’t any hidden fees you need to be aware of.
2. Keep Track of Your Expenses
A mistake many students make is not keeping proper track of when and where they’re spending money. When you have a credit card, it can be easy to fall into the trap of thinking that you have access to free money. You still have to pay for everything you buy!
Maintain a record of everything you charge to your card on a monthly basis and keep a running total so you’re not surprised at the end of the month when you receive your statement. Most banks let you track your spending online, which is extremely helpful as you’ll be able to see how much you spent as well as where you spent it.
Set a monthly spending allowance for yourself and budget your expanses carefully to avoid spending beyond your means. Although it may be tempting to splurge on that winter break trip to the Swiss Alps, just think how happy you’ll be come summer when you’re friends are still struggling to pay off their bills and you’re relaxing poolside.
3. Always Pay Your Monthly Balance
We cannot stress this last bit of advice enough. The best way to avoid credit card debt is to always – and we mean always – pay your credit card bill in full. Not only will this save you from paying interest rates, but it will also keep your credit card score healthy.
If it’s a particularly hard month on your wallet (such as around the holidays or beginning of term when you’re buying all your new text books) and you simply cannot pay the bill in full, at least make sure you pay the minimum. Otherwise you will have to pay late fees in addition to interest.
Credit cards can be extremely helpful if you want to build your credit score or if you find yourself in an emergency situation, just make sure you follow our advice and spend wisely.