Buy Now Pay Later

Credit cards….most of you have at least one.  Discover, Mastercard, Visa, they love to market credit cards to college students.  It is a great way to build your credit…and it is an even better way to destroy it.

My freshman year I picked up a ringing phone and 10 minutes later I had my first credit card.  I was going to be responsible…and I was…for about 2 years. Then I got another credit card because I had been so responsible with my first.  Slowly I started charging more and paying less each month until I was close to my credit limit and could only make minimum payments.  You would have thought that Visa would have done something, here is a 20 year old woman close to her limit and she only makes the minimum payment.  Visa did do something….they increased my credit line.  It became a cycle…I would get near my limit and then they would increase it.

I never worried about my growing debt…I was about to graduate college, I would get a great job and be able to pay it off in no time.  Then life happened and I could not get that great job after graduation and life happened again and I could not work for 3 months.  I could not pay my credit card bills and I was in the middle of a financial disaster.

6 years later and I finally have emerged from financial chaos.  My credit score is improving but what happened 6 years ago still haunts me.  When i went to buy a new car I had to pay a larger down payment and I am paying an insane interest rate.

I am not telling anyone not to get a credit card, but I am telling you to make better choices than I did.  Here are some facts:

• 63% of college students have at least one credit card.
• Only 58% of those who own a card pay their balances every month.
• The longer a student has had a card, the less likely he or she is to pay off the balance.

Here are some tips:

• If you must have a credit card as a student, keep only one.
• Deliberately keep your maximum available credit as low as possible.
• Consider getting a secured credit card (you have to pay the credit card company upfront and what you pay is your credit limit).

If you need a credit card here are some things to consider:

• Finance charges
• Annual dues or membership, and enrollment fees
• Late payment and grace periods
• Special fees, changes in introductory rates, or penalties

You have to be your own financial advocate.  Visa/Mastercard/Discover want you to have credit because every month you carry a balance…they make money, every time you are late with a payment…they make money.

Click here for more financial guidance.

Click here to learn more about money management at UNT.

Tell us in the comment section: Do you have a credit card? Why or why not?

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