Money Management Tips - What You Need To Know Before Applying For A Credit Card
Tuesday, February 19th, 2008 Subscribe To Our Feed
The following article is from a series of managing money articles, videos, tips and information about Borrowing Money …
Anyone who has ever walked into 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 put away your own money and use their MasterCard or Visa credit cards. It is a buy now and pay later world. For most people who recently turned eighteen, this can seem like a liberating source of power, especially if cash is limited due to school.
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 difficulty. Student credit card debt is out of control. Students are flooded with bank credit cards, MasterCard or Visa credit card offers and many do not consider the consequences of how easy it is to abuse credit.
No one doubts that college is expensive. Tuition, room, board and associated expenses can wipe out savings very quickly. You, as a student, may have such a demanding class schedule that makes working part time impossible. This is especially difficult if you are committed to participating in school activities, such as sports or academic organizations. Most parents cannot afford all the additional expenses incurred by their children as students, not to mention if there are off campus expenses and luxuries wanted.
It is important to note that when you apply for a credit card and have received it, you have agreed to the lender’s terms. Only use the line of credit as an emergency source of funds should you find yourself in justifiable need. You do not want to find yourself with maxed out cards and no way to make the minimum monthly repayments. Pay special attention to the fine print and the interest rates.
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 rating and seriously hurting your credit score. Be smart, build credit ratings, use your credit wisely and you will learn how to be financially responsible.
For more articles on managing debt, visit: Money Management
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