Student Credit Cards and the Sensible Way to Use Them
Whether you are in the hunt for your first student credit card or you are looking to apply for one, there are a few rules you should tell yourself before you actually start taking it places and swiping it like a mad man. There are many things out there that students should not use their credit cards on and this is the sole purpose I am writing this article today. I am hoping that this list will help you avoid trouble in the near future.
Withdrawing money from an ATM
Say you are going out to a club or party where you're going to need cash. If you do not have any cash in your bank account, do not withdrawal money using your credit card. Even though you are able to do this, you are going to eat up a very big APR rate on cash advances. This rate is almost double your APR and could kill you. If you take out $100, you can possibly end up paying at least $200 plus back to the credit card companies. If it is a worst-case scenario, borrow the money from a friend.
The credit card checks
If you are already have your credit card, I am sure you have received the infamous checks in the mail saying you can use these checks and it'll take the money directly from your credit card account. I would highly advise you to stay away from these. The reason is that like the cash advances, these have fees on top of your regular spending limits. Depending on your card, these rates can vary. It is always best to just open up your own checking account and write check from there.
Every day bills
If you get a bill month like your cell phone, rent, etc, try to avoid paying these bills off with your credit card. If pay your rent off with your credit card, you may forget that you even put it on there and not budget properly. This would then lead you to overspending and not being able to paying your bill off in time. Remember, the key to a credit card is to pay your bill off in full each month so that you avoid those annoying charges!
Impulse purchases are a no-no
My general rule is if you cannot afford it or you cannot pay the bill off in full then do not buy it. Do not treat your credit card like its fake money. You will end up getting that bill in the mail at the end of the month every month and if you cannot pay it off, you are going to be trouble. My best bet is to set aside a spending limit each month and stick to it. If you cannot do this, a credit card isn't for you. These are just a few things you should follow when you're applying or using your credit card. If you can remember these helpful tips the next time you use your card, you should not have a hard time using your card. A careless spender is a bad credit card user!