Students are prone to acquiring credit card debt. Why? Because most young people do not know or are not paying attention on how to handle their credit cards correctly. Here are some practical advice on the proper use of student credit cards and how to avoid credit card debt.
Its Just a Marketing Strategy
Be aware that credit card companies are experts when it comes to marketing their business. They spend millions of dollars in using different marketing strategies to get your attention, to grab your interest and move you to sign up with their company. Credit card companies may give away freebies, offer instant approval, and other promotional tactics which can be very hard to resist. Dont be too naïve in applying for a credit card just so you can get a free coffee mug or t-shirt. Remember, theres more to it than just the freebie.
Dont Settle for High Rates
There are so many different credit card companies that are competing in the market today that students dont have to settle for a credit card with unsatisfactory features. Some credit card companies charge high rates for students because they havent yet established their own credit. However, there are still other credit card issuers who offer reasonable rates even for students like you. Dont rush in signing up that application as if theres no tomorrow. Take your time in choosing the right student credit card with the most reasonable rates. Compare the rates and features that each credit card provides. Only then can you be sure that youve chosen the right one.
Control the Use of Your Credit Card
Dont use your credit card on all your spending needs. For instance, if youre going to eat in a restaurant or watch a movie be sure you have the budget to spend on it. Dont use your student credit card on such expenses. If youll get into the habit of charging all your expenses on your credit card, it is not unlikely that you will soon be facing credit card debt. Because credit cards are so convenient to use, you wont immediately realize that youre already spending way out of your means. In the end, youll have a very hard time paying off your balances.
You can find valuable articles on the internet that are related to credit cards and credit card management. Learn about the features of a credit card, know your rights and your responsibilities as a credit card holder, know what a credit report is, how your credit report can affect you and read advises on how you can manage your finances correctly.
Budget your money
Budgeting plays an important role in avoiding credit card debt. What is your exact budget for an entire month? Whether you are self-supporting or receiving allowance from your parents, plan exactly how much you intend on spending out of that cash. Dont forget to save even just a small portion from your monthly allowance. This savings will be your fund which you can use when emergencies arise. Make sure that you will not go beyond your intended expenses for the month. When making a purchase, think about it ten times. Do you really need that particular item? Or do you just want it? Have the determination to say no or back out from making a purchase if you know that its not really very important.
Pay Your Dues
Using your student credit card in purchasing doesnt grant you the freedom from paying it back. So pay your credit card balances on time and never ever try to skip on a payment. Be aware about the scheduled deadline on your payments. Check your monthly statement of account and see to it that youre keeping up with your credit card payments.