Do Not Fall In the Credit Card Debt Trap

Going off to college is one of the most exciting things in a young person’s life.  The last thing on your mind is future financial expenses. However, the past few years from 2007 to the present 2011 has shown you that the economy can bottom up at any given point in time.  America is slowly emerging from a long period of recession, which was caused mainly by bad mortgages and excessive credit card defaults.  Start thinking from now how to use credit wisely. More and more employers are pulling your credit history and doing background checks before they bring you onto their team.  Do not let the excitement of going off to college, and moving out on your own cause you to do things that will hurt your financial future.youngandindebt-usatodayCredit: usatoday


Do not Get Caught in the Trap

You will be flooded with credit card offers.  The college campuses should ban this practice because it is just setting students up for financial failure.  However, you are adults and should be able to make your own decisions regarding credit use. After all, this is part of the experience of moving out on your own, even if it is just a college dorm.  Your college textbooks will have credit card offers, every bulletin board on the college campus will have advertisements for credit cards, and you will definitely have credit card representatives pushing their product in your college hallways, dorms and bookstore. 

You will even find unsolicited offers pouring out of your on campus mailbox. So why do these credit card companies bombard you with credit card offers when they know the average college student does not have a job to pay for the debt? Well, simply because they know mommy and daddy will pay the bill in order to save your credit. They know for the most part that most college students do not know how to manage credit, so you use your credit card to buy pizza, books, concert tickets, clothes and dine out with your friends.


Make Wise Decisions to Avoid College Credit Card Debt

According to USA Today, in a 2006 article entitled “Young and In Debt”, the population with the growing debt-usatodayCredit: usatodayhighest amount of credit card charge offs are recent graduates or “twenty-something’s”.  This massive debt accumulation is a result of student loan payments and credit card debts accrued while they were in college. Some graduates have been forced to change their career plans because of their disastrous financial state.

Start now while you are in college to avoid college credit card debt.  Get only one credit card; do not apply for 10 or 12 cards because you do not need them. All you are doing is setting yourself up for disaster.  The credit limit on a student credit card is usually from $500 to $1000, this is enough for you to use to build your credit history without ruining your financial future. If you do not have the money to pay for something, then do not charge it on the card. Pay off your charges in one or two payments.

Do not charge it because you “want” it; charge it because you “need” it.  Credit card companies are now suing debtors for not paying their credit card bill, so the best thing for you is not to put yourself in a position where your are racking up bills without the ability to pay. Do not treat your credit card as if it is permission to go on endless shopping sprees, treat it with respect and responsibility and you should be well on your way to building a good solid credit history and a good credit score. At this early stage in your career, you should be more focused on creating wealth that will help secure your financial future.