Signing up for credit cards in college is tempting, especially when you find yourself bombarded by loads of credit card offers with special student incentives.
While having a credit card can be useful for emergencies and bigger expenses (like that winter break ski trip to Colorado!) it’s important to use credit cards responsibly.
Take a look at these credit card tips before you sign up for a college credit card and get your hands on that magic piece of plastic.
The Pros of a College Credit Card
Having a credit card can be a good thing. Paying off your college credit card bills on-time will help establish a good credit rating. This means that in the future, banks will be more likely to loan you money for big expenses, like cars and homes.
Of course, those may be the last things on your mind while you’re in college! But in addition to all of the negatives you hear about signing up for a credit card in college, you should be aware of the possible benefits of a credit card which you handle responsibly.
Do You Really Need a Credit Card?
Despite the potential pros of having a college credit card, one of the most important things to consider is whether you really need one. Ask yourself: What will I use it for? Can I afford it? Are you planning to get a student job to pay the credit card bills each month?
Make sure that you are up to the responsibility of a college credit card before you get one. Many students in college opt not to get a credit card simply because they don’t feel like dealing with the extra responsibility and potential hassle it may bring.
Getting a College Credit Card
If you decide that you do need a credit card, be smart about which one you get. Credit card companies often try to suck students in with freebies or seemingly fantastic deals – be careful!
So what should you consider when choosing a credit card?
Look at the card’s annual fee and annual percentage rate (APR), which is the interest rate you will pay when you borrow money with your card. Many students choose cards with low APR’s without reading the fine print and realizing that the APR goes up after a certain period of time.
Turn to Someone Experienced for Help
When getting a college credit card, it may be best to consult someone who has experience with credit cards, like your parents, for credit card tips.
Yes, you’ve left home and are in college and probably don’t want to turn to your parents for help! Odds are, however, that your parents know more about credit cards than you do and can give you credit card tips to help you make a smart choice.
Got a Card? Watch Your Spending!
This seems pretty obvious, but we’ll point it out anyway: credit cards are not magic! Simply swiping that piece of plastic doesn’t mean you’re in the clear.
It might seem like one of the most obvious credit card tips out there, but remember that whatever you charge, you will have to pay off – plus interest if you miss payments.
The #1 Credit Card Tip
Of all credit card tips, this is the most important: Don’t sign up for the first credit card offer you get in the mail, just because they advertise special low interest rates for students or other perks.
Still considering a credit card? Remember to look at all your options, talk to others who know more about credit cards, and always, always, always read the fine print before getting a credit card in college.