Top Credit Card Tips For College Students

College students have to get used to debt. But when you’re laboring under the burden of college debt, do you really want to add a credit card to the mix? Credit card debt, managed correctly in the short-term, can actually open your horizons as a college student, enabling you to make better financial choices and purchases. What’s more, getting started running a credit card and paying it off regularly can improve your credit score. This makes it easier to access loans later in life. Here are the top credit card tips for students to help you make the right choices around credit cards.

1) Pay The Bill on Time–Every Time

The number one rule for credit cards is to pay your bills on time. A credit card will give you multiple options for how much to pay, from minimum payments covering little more than the interest you’ve accrued on your purchases to your full balance. If you don’t pay your bills, late payment fees will be compounded with interest. Remember, the less you pay the more interest you’re paying off, meaning you’re wasting money when there’s a greater balance on your card.

2) Live within Your Means

College students often live on meagre incomes, dreaming of the day they graduate into a high-paying job. With that future income on your mind, you might be tempted to splash out on some luxuries now and pay them off later. However, when you put more on your credit card than you can realistically pay off given your current circumstances, you run the risk of spiraling into debt. If you can’t make significant payments to your credit card, then a large proportion of what you’re paying off each month will be interest. Don’t use a credit card to live outside your means.

3) Avoiding Certain Features

There are a wide range of credit cards with many different features from hefty annual fees to air miles racked up as you spend. As a college student, it’s best not to get carried away with high-profile platinum credit cards, as you’re unlikely to be spending enough to make these cards worthwhile. Avoid cards with annual fees for bonus features–when working on a tight budget, these fees can catch you out and push you into the red. Keep it simple and don’t’ go chasing air miles or reward points.

Compare Credit Cards for Students

Any spending that takes place on your credit card is your responsibility. That means that lending it out to your friends entails the risk of being burdened with debt that you didn’t want. A credit card isn’t a toy and shouldn’t be shared with your friends, whenever they’ve burst their budget for the month. While a credit card can seem like “free money,” there are very real consequences that come with spending it.

5) One Card Is Often Enough

Once you open a credit card, it’s common for your lender to share your details with other banks and card providers who will start sending you offers. Don’t be tempted by the offer of greater spending power across multiple cards. Keeping track of credit card debt can rapidly spiral into a complicated and financially draining challenge. Stick to one card and track payments to ensure your finances stay ship-shape.

6) Keep Your Credit Limit Low

For some students, getting a credit arrangement in the first place can be challenging, but others have the opposite problem. Once you open a credit card, lenders are likely to encourage you to spend by upping your credit limit on a regular basis. If your credit card operator is increasing your credit limit beyond what you’re comfortable with, ask them to reduce it to keep spending in check.

Wrapping Up

College is a time of transition into adulthood, and getting a credit card is a rite of passage. By learning to manage your finances and building your credit score you’ll be standing in good stead for future decisions such as home ownership. But spending wisely, paying your balance off, and understanding the risks of credit are vital.