There’s a lot to love about being a new college student. You’re making new friends, taking new classes and finding yourself because you have a lot more independence. Getting to know yourself is great, but that independence can be a double-edged sword if you’re not careful.
As a college student, you can start to expect credit card offers, whether they come in the mail or you’re asked to sign up at a store. AbbyBank is here to offer you tips to make sure you are managing your money effectively and not piling up a lot of credit card debt before graduation.
Limit Your Purchases
Everyone makes a few quick purchases now and then. Whether you need a quick bite to eat, new books for school or new clothes, people use their credit cards to make purchase all the time. However, these purchases can pile up quickly, which can lead to piling up a balance that you can’t pay down. To stop this, start with a low-balance credit card that you know you’ll be able to pay your balance on each month. This helps you build your credit and can help you earn rewards. Remember, just because your limit is $1,000 doesn’t mean you have to reach your limit every time.
Beware Store Credit Cards
We’ve all been there. You’re at the cashier’s stand and you’re told that you can save 15 percent on your purchase if you sign up for the store credit card. While this may help you save a few bucks on that purchase, a store credit card may do more harm than good. For starters, applying for a ton of store cards will damage your credit score, forcing you to lose a few points with each application. On top of that, store cards typically have higher interest rates than non-store cards.
Checking Accounts are Your Friend
For those times when you need to make a quick purchase and you don’t have any cash on you, debit cards may be a much wiser option. Debit cards are directly connected to your checking account, and don’t allow you to go outside your means. You’ll learn that checking your balance is important to make sure you have enough money to make a purchase, which is always a good habit to get into. Opening a checking account is a great way to learn how to start using a card responsibly before you graduate to credit cards.