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Almost
all students have and use student
credit cards.
Some of the students use them wisely and build for
them an early credit history
but others accumulate lots of debts that would
have to be paid off once the student life is over.
Students that have a credit card
should learn how to take charge and manage their
own finances as soon as possible, because the time
between teen years and adulthood is very short.
So, the sooner a student starts managing his own
financial matters the sooner he will develop
useful financial skills. Student credit cards are
no longer a privilege for wealthy students but now
are considered a social entitlement.
A
student can very easily obtain a student credit
card. Offers for student credit cards are
everywhere students are: in campuses, at social
functions, in their mail boxes, in bookstores,
etc. That is because credit companies consider
students to be good customers. First of all they
are loyal; once a student obtains a credit card,
he is likely to keep this particular card for
years to come and instead of getting other new
cards they upgrade it every time they fill the
need to do it. Nowadays, the conditions to obtain
a student credit card are very weak, so more and
more students have access to them even though they
don’t have a steady source of income. And this is
a second reason why credit card companies offer
more and more credit cards to students: they
usually can’t repay their debts in time. And this
is what credit cards companies rely on; they make
lots of money from late payment penalties,
interest fees on unpaid credit card balances,
annual fees
and more. So, students that don’t repay their
credit card balances in full each month are the
best customers.
Every college freshman wants to have at least one
credit card because it will help him very much
during his college years; the student will be able
to rent a car, buy books or concert tickets,
provide himself help with medical or other
emergencies and more. Apart from financial help
during college years, student credit cards offer
other types of help by building a credit history.
Credit history is the record of all that happens
in your financial situation throughout the years.
Credit scoring is a system based on all that
happens to your accounts: late payments, bill
paying history, number and type of accounts,
outstanding debts and more. If the credit history
and scoring are good the student will more easily
obtain a house or a car loan, certain types of
financial jobs, insurance premiums and more other
benefits. So, the student must pay his bills in
full or in time, in order to benefit later of
their first years of credit history.
The
most difficult thing for a student is to choose
from the large number of student credit card
offers. And the best way for a student to choose a
credit card for himself is to talk to other
students and get advice from the ones that already
have and use a credit card and compare credit card
offers online. Before choosing a credit card, the
student must be aware of the card’s terms of use.
Most student that already have a credit card
recommend for the others a card with no
annual fee
and the option to limit the amount to be spent.
And apart from these safety measures, wise
students that think of their financial future
often take a personal finance course in order to
learn all kinds of financial management skills
that will help them throughout their entire life.
Students must be very careful when using their
student credit cards; they always have to be
cautious about the amount charged on the credit
card and, at the end of the month, to review the
amount of interest they have to pay monthly. It is
also recommendable that the credit card balance to
be paid as soon as received. If for some reason
the balances cannot be paid in full, the student
must pay at least the
minimum payment
required. If problems with paying the credit card
balances appear, the student must ask help from a
financial counselor that will always have a
solution for him as student loan repayments are
much more flexible than consumer loan repayments.
And another thing students must be careful about
is identity theft;
the credit card or social security numbers should
not be given to anybody over the phone. These are
important information that cannot get into the
hands of wrong people because will very much
damage the credit history. So, we can consider
that it is best for students to have a credit card
starting with their freshman college years
because, if used wisely, the credit card history
built in this period will very much help them
throughout their entire life.
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