A Student’s Credit – A Report Card for Life
Sunday, May 17th, 2009When students move off to college for the first time, there is a lot of anxiety about what to expect and how they will 
survive. Chances are good that personal finances are the last thing on the minds of college freshman, beyond making sure mom and dad regularly send cash. But the reality of the college years is that it is often the same time that an individual’s credit report will be established.
College Credit Cards
If you are a college-bound freshman, you will likely come across several on-campus kiosks for college-specific credit cards. It may seem like you hit the jackpot at being old enough to have your own credit card but if you don’t know what you are getting into, you can suffer a bad credit score for many years to come. Credit card companies are willing to help students get started with establishing a credit history but it is up to the student to understand how credit works before delving into the credit card world.
As a student, you may not have a stable source of income outside of your parents, which means unless mom and dad agree to pay your credit card balance off each month, you better find a job if you plan to charge. With so many people in debt now, much research points to college years as the time when credit scores went down hill. Those who spent recklessly during college without a financial plan to pay off each month’s balance, are still paying on debts from years ago. Add interest charges, late payment charges, and penalties, what once may have seemed a relatively small balance has grown to an insurmountable sum.
Understand Your Credit
If you plan to get a credit card, make sure you know how it affects your credit score and your future. If you feel you can responsibly handle credit cards and have a means to pay for them each month, check out the various student credit cards that are available and reap the rewards that a student in college may appreciate. Keep your credit card accounts to a minimum, maybe one or two, so you don’t overspend and get in over your head. Have a source of income beyond your parents to ensure what you buy, you can afford. Make a point of putting aside the cash equivalent of the amount you charge in an envelope or your bank account so you’ll have no problem paying off the balance when it comes due. Never pay late or you will incur fees you probably can’t afford. Never lead anyone your credit card for any reason, unless you want to be solely responsible for any misuse.
If you are able to keep up with payments and make the credit card work for you, you will be able to establish a good credit score that will carry over into your life after graduation when you need it most – buying a house, buying a car, and even getting a job. Your credit score is no joke and needs to be taken just as seriously as your college GPA. Starting out on the right foot in college will help prepare you for a life beyond college and a stable financial future.
