A Basic Guide To Student Credit Cards
Posted by admin on Mar 8, 2009
Becoming a college student is a major event in any person’s life. It represents a pinnacle of achievement that is the result of years of study and hard work. While the road ahead is long and there is a lot more that life has in store for you, you can take comfort in the fact that you have done well.
What you will quickly realize as a college student is that many credit card companies will be eager to offer you student credit cards. Of course student credit cards can really be quite handy for any college student, what with all the expenses that go hand in hand with being in college. These cards can be invaluable for a wide range of uses, from making Internet purchases, paying for gas, getting your car fixed, and even buying groceries.
As tempting as the prospect of getting a student credit card is, you would do well to consider the decision from every possible angle carefully. With the many attractive benefits that student credit cards have to offer, it is easy to be confused by the variety of offers and simply go with the first credit card company that makes an offer. Be patient it is important to compare multiple student credit cards available to ensure that you get one that is right for your needs and financial situation.
One thing you will have to consider is that student credit cards are not merely convenient; they can also help you build a solid credit history for your future, not to mention teach you important money management skills that you will carry into adulthood. It is therefore important to keep certain things in mind regarding the use of student credit cards.
Finally, take it easy with your first credit card. At this early stage of your credit history, you look for student credit cards that do not have annual fees and carry a credit limit of $500 or less. This will enable you to handle all the financial requirements of the student credit card more easily. The relatively low credit limit will make it easier for you to afford the monthly payments.
Always pay your student credit card bills on time. This is something that you would do well to always remember. If you don’t pay off your bills on time, you risk the chance of incurring stiff penalties and possibly even a bad credit standing.
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Some of the ways by which you can increase your credit score are outlined below.
Check for any errors in your credit report and correct them.
You should check all your credit reports for any errors, since any mistakes present can result in you having a low credit rating. You should look into this as early as possible, since correcting any mistakes in your credit report is a process than can take a long time.
Make payments on time
Most credit card companies will take a close look at your history of payment in order to determine your eligibility for a credit card with better terms.
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They do come with a lot of benefits and advantages, which makes it tempting to simply sign up with the first credit card company that offers you one. Patience is a tremendously valuable virtue to have at this stage, and you will be far better off taking the time to compare the different student credit cards available to find out which ones offer the best deals for you.
One thing you will have to consider is that student credit cards are not merely convenient; they can also help you build a solid credit history for your future, not to mention teach you important money management skills that you will carry into adulthood. It is therefore important to keep certain things in mind regarding the use of student credit cards.
Go slow with your first student credit card.
The first and best trick to try is merely to call your credit card issuer and ask them for a better interest rate. A national survey discovered that customers who just called their credit card company and stated that they had gotten better offers from other companies and were planning to switch succeeded in getting lower rates 56 percent of the time. They dropped an average of five or six percentage points off their annual interest rate, and some of them got perks like zero percent interest for six months. One customer with an exorbitant interest rate managed to reduce it by more than half, encouraging news if you have a credit card for bad credit. Customers suffered no penalties if their credit card issuer refused to lower their interest rates.
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College kids are an effortless target. Many are away from home for the first time and are asserting their independence. The idea of having credit cards in their name can seem like the ticket to financial freedom.
University and banks have long standing relationships. Bank of America and Michigan State University, for example, have a multi million dollar contract that gives the bank access to the names of students currently enrolled.
They want the students at its universities to understand the responsibility they take on when they open a credit card account.
The country is coming to terms with the economic downturn and consumers are restructuring their financial goals. The years of a booming real estate market and economy left some feeling they could spend freely without consequence. As a result, some are now reworking their budgets and striving to eliminate credit card debt. State lawmakers and college administrators who are trying to restrict marketing practices regarding student credit cards are hoping they can keep young people from establishing bad credit habits early on.
If you carry a balance on your credit cards that is beyond your financial means and you wish pay off the debt, it is best to not make any additional purchases on that card. Next, examine your budget and reallocate any discretionary funds to make larger payments (rather than the minimum payment) to decrease that debt quickly. Again, when you only pay the minimum payment, the majority of that payment is interest to the bank. The larger your payments, the less money you pay in interest. And the sooner you pay off that balance, the less interest you pay in the long run.
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But by making only the minimum payment, most of that bill goes toward interest and not the balance. By regularly paying only the minimum payments each month and continuing to make purchases on those credit cards, a consumer can easily get stuck in a cycle of debt.
Credit cards should be viewed as a method of payment, not a loan to buy things that a consumer cannot otherwise afford. Balances should be paid in a timely manner. By keeping balances on credit cards in check, unexpected expenses for emergencies can be managed with ease.
It’s a heavy load of debt to carry when you’re new to the full time workforce and still looking for a job in your field. And it doesn’t take big purchases or heavy spending to rack up. $3,173 is barely $793 a year. That’s $66 a month or $15. 25 a week.
But if you prefer your privacy, then pick a card with no cosigner requirement.
Student credit cards also offer perks like money back on purchases. Some cards offer as much as 20% back on online purchases made at certain retailers. That can be a substantial savings. Just check beforehand to make sure the stores you can save at are the stores you like to go to.
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Very helpful stuff here.
More consumers, consequently, have had to look for credit cards for bad credit.
In order to have a credit report and credit score, you need credit history from things like a credit card. And you cannot get more credit, unless you have some credit history. Those who have to obtain credit cards for bad credit now are all too aware of the importance of credit accounts that are in good standing. They are often forced to obtain a card with higher rates and fees, due to their poor credit histories.
Tell the customer service representatives that other companies are offering you better deals, and you are considering transferring to them. Often, the representative will be able to negotiate a better deal with you. (If the first person you speak to can’t help you, thank them politely, hang up, and call back later. Other representatives may have more leeway or may know a loophole in the regulations that the first representative didn’t know about. ) The worst the company can do is say no.