What You Need To Know Before You Apply For A Credit Card
February 20th, 2008 by admin
The following extract is from a series of money management articles, videos and tips about Student Loans …
Anyone who has ever been to a retail or department store knows how easy it is to apply for a credit card. A highly effective marketing strategy is to offer the 10% off the purchase price to lure customers into applying. Credit card companies want you to save your cash and use their MasterCard or Visa credit cards. We live in a world of instant gratification. For most people who recently turned eighteen, this can seem like a tremendous power, especially if cash is limited due to college expenses.
Instant approval credit cards may seem like a welcome source of relief when you find yourself in urgent need of school supplies or in need of the basic essentials. However, almost always, the ease and conveninence of applying and getting a credit card can lead to overwhelming financial problems. Student credit card debt has spiralled out of control. Students are flooded with bank credit cards, MasterCard or Visa credit card offers and many do not stop and consider the consequences of how easy it is to abuse their use.
No one is arguing that higher education is expensive. Tuition, room, board and associated fees can deplete cash reserves very quickly. You, as a student, may have such an immense class schedule that working part-time becomes impossible. This is especially difficult if you are involved in school activities, such as sports or academic organizations. Most parents cannot afford to pay for all the additional expenses a student incurs, not to mention if there are off campus expenses and luxuries wanted.
It is important to remember that when you apply for a college student credit card and the application is successful, you have agreed to the credit card company’s terms and conditions. Only use the line of credit as an emergency source of funds should you find yourself in urgent need. You do not want to find yourself with maxed out cards and no way to make the repayments. Pay attention to the fine print and the rates of interest you will be charged.
Do not apply for a credit card every time you walk into a store. Don’t fill out an online credit card application every time you are surfing the net. While you want to have a good credit rating, each credit card you apply for goes against your credit score and can start lowering it dramatically. There is a delicate balance between improving your credit rating and seriously damaging your credit score. Be smart, build credit ratings, use your credit wisely and you will become financially responsible.
For more articles on money management, visit: Credit Cards