HARRISBURG, Pa. – Thousands of Pennsylvania students will head back to college next month and many of them will be carrying at least one credit card.
Attorney General Kathleen G. Kane yesterday advised students to educate themselves on credit matters before taking on the responsibility of a credit card.
Students are often inundated with opportunities to apply for credit cards once they arrive at school, through on-campus promotions and applications in their mailboxes. With so much “easy credit” available, it is critical that young adults understand how to live within their means and avoid getting into ballooning credit card debt.
Poor credit decisions made in college can often follow a person for many years.
Here are some important tips when considering applying for a credit card:
- Limit the number of credit cards you have. The more credit you have, the more likely you are to spend. Even if you don’t use all your available credit, companies treat unused credit as money you can spend, and may deny you a car loan or school loan because of a high credit line.
- Shop around for the best “terms.” Not all credit cards are the same. One may offer special rebates, but charge a higher rate. Others may require an annual fee.
- Be sure to understand all the language used in the agreement. Does the company begin charging interest from the day you make a purchase, or is there a grace period until the bill is due?
- Pay your credit card bill in full and on time. Keeping a balance on a credit card, often at the highest rate allowable by law, is a very expensive way to get a loan.
Students who run into difficulty with credit should talk with their parents or another trusted adult.
There are no quick fixes for bad credit.
Paying your bills regularly is the only solution for getting back on the right track to managing your debt and improving your credit score.