How To Avoid Being Trapped in Student Credit Card Debt

College students graduate with two types of debts on their hands- student loan and credit card debt. If you are a student, how can you avoid getting stuck in debt, particularly student credit card debt? How can you make the most out of your student credit card without putting yourself in debt trouble? Here are some tips:

Use your student credit card with care. Your student credit card is supposed to provide assistance with your studies. Unfortunately, many students abuse the ease and convenience of paying with student credit cards which results to debt problems. Remember that each time you charge something to your student credit card, it is your duty to pay it back on time.

Not submitting your credit card payments on time or in full can cause you to incur high interest fees and late penalty charges. Therefore, before using your student credit card, ask yourself, “Is this purchase or expense really important for my studies?”. “Will I be able to pay it back in full before my due date ends?”

Get a part time job to cover for your personal expenses. Some students get a part time job while in college earn extra money to help them with their studies. A part time job also enables these students to pay off their student loans even while studying. This way, they wouldn’t be in so much debt when they graduate college.

Budget your monthly expenses. Even if you have a student loan and a student credit card to help you with your expenses, it is only wise to create a monthly budget plan and stick with it. How much do you need to spend for the whole month both for your studies and personal needs? If you have limited cash, you may need to make adjustments on your lifestyle instead of charging everything to your student credit card.

Don’t wait for things to go from worse to worst. If you notice that you’re having a difficult time budgeting your money and keeping up with your debts, don’t be afraid to get help. Seek advice from a legitimate credit counseling agency. A credit counselor should be able to help you manage your money efficiently and overcome debt problems.

Nevertheless, it’s important to make sure that you’re seeking help from the right credit counseling agency. Some credit counseling services may offer you false help or unnecessary advices that can worsen your debt problems.

Pay your student credit card balance in full each month. You may be tempted to pay only the minimum payment on your student credit card but this also means incurring high interest rates and would take you a longer time to complete your payments.

Paying off your credit card balance completely each month is crucial in overcoming and staying away from debt. This habit protects you from additional interest rate charges and late penalty fees. It also minimizes the risk of building up debts in your account. More importantly, it keeps your credit score and credit history in excellent standing.

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How a Student can Stay Away from Student Credit Card Debt

Having a credit card makes sometimes a students becomes irresponsible and get trap from debt. Find out how to avoid and be prepared through this article.

As a college student, you may agree that life is not easy all the time. Aside from the challenges of dealing with peers and professors, passing exams, and keeping up with the daily school activities, financial issues can also add to the pressure. Many college students today find themselves confronted with the burden of debt on their shoulders.

According to surveys, students with bad credit all have one thing in common – unpaid student credit card debt. According to the Consolidated Credit Counseling Services Inc. 40% of college students get at least one student credit card on their freshmen year, while 20% apply for student credit cards while they’re in still high school.

True, getting approved for a student credit card is fairly easy and owning a student credit card does have its advantages. Unfortunately, most students with credit cards don’t know how to handle their student credit cards correctly. A study conducted by Nellie Mae, a leading student loan lending company, reveals that in 2001, 83% of undergraduate students own a credit card- each with existing balances that amount to $2,327 on average. Imagine how difficult it could be for a student to pay off a credit card balance of $2,000 in full.

Surviving Student Credit Card Debt

Are you a student yourself? The best thing to do to avoid student credit card debt is to handle your student credit card with caution. Financial experts agree that student credit cards can be a great tool in building your credit history. But don’t let the convenience of a student credit card lead you to overspending and eventually, bad debt.

What every student must realize is that each time they use their student credit card for a purchase or for a charge, he or she has the obligation to pay it back on time. Other students may reason out that they have the option to pay only the minimum payment required and carry over their balance for the next billing period. But such reasoning can easily lead to unmanageable debt. Remember, if you carry over your balance from month to month, you incur the high interest rate charges and you increase the risk of building up debts in your account. That is why, all credit card holders – not only students – are advised to pay off their monthly balances in full at all times.

Parents also play a big role in helping young people understand their obligations as new credit card holders. In choosing a student credit card, you can work with your teen-ager and guide them with their choice. You may share your own experiences as a credit card owner as well. You may also recommend a particular student credit card that you think offers the better deal. Encourage your kids to read the credit card’s Terms and Conditions in full so that they can personally understand what they’re signing up for. Emphasize the importance of building a credit history. Teach your kids how they can take care of their credit and keep it in a good or excellent status.

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