Thursday, October 4, 2012

Build Your Credit With A Student Credit Card

If you are currently in or planning to go to college soon, then congratulations! You have just taken your first step into a larger world. But even though there is a lot of fun, excitement, and education in this new world you will soon find that it is also very expensive. Since not everyone can carry cash around for things like text books, gas, or other expenses it might be a good idea to consider getting a student credit card. A student credit card is a good way to begin training yourself how to spend wisely with credit and also build credit for your future.

Before committing to any student credit card, do a little research. Try not to fall for gimmicks or rewards programs unless they are worthwhile. Instead look for a secured credit card with a lower interest rate. A secured credit card is similar to a traditional card except that you have to put down a security deposit to gain assurance from the issuer that you will repay your debt. These cards will carry smaller balances, but that is the key to successfully learning how to use your card as you gain more freedom.

With your new secured low balance student credit card, it is time to learn how to use it. As mentioned before, a good place to start might be purchasing books for your classes. You can also use it for a few other things like software or supplies, but generally your first purchases should be those of needs and not wants. You should also be sure to charge only what you can pay off in full by the next bill. Paying only minimums is a great way to get into and stay in debt so try and avoid that pitfall early on.

Another key to building your credit with your student credit card is not only to pay in full every month, but also to make sure that the payment is made on time. To help you with this, you might want to consider setting up a direct payment account through the credit card's website so that you can pay at your convenience. A quick way to lower your credit score and raise interest rates is to make late payments. Your student credit card should always be paid on time, and if an issue comes up contact the issuer to see what your options are for extensions. Just try not to make a habit of it.

Building your credit with a student credit card is a great way to learn the responsible use of credit. Try and limit your purchases only to necessities related to school or things like gas for your car and you should be able to maintain and build a great credit score through graduation. Just remember that credit is not extra money, and whatever you spend must be paid back in full or the interest will build up. You can build credit as you earn college credit as long as you stick to these simple tips.

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