Student Credit Card and Credit Education Blog

If you have ever seen the movie Confessions of a Shopaholic, you know that it can be extremely easy to work up a huge amount of credit card debt that can absolutely haunt you. In the movie, Isla Fisher’s character, Rebecca Bloomwood, had 12 credit cards — all maxed out — and dealt with the constant pressure of having to worry about paying it all back, while being constantly harassed by a persistent debt collector with bad personal hygiene.

Although that is just a movie, it is a very potent reminder of why we need to stay in control of our finances and truly know what we are getting into when it comes to credit cards. A student credit card is likely the first type of card that anyone owns when growing up and becoming an adult. It has high interest, and exists to establish the very beginnings of your credit history.

Here’s a few solid tips for keeping that shiny hunk of plastic under lockdown, and making the start of your credit journey a smooth and expected one:

1. Don’t use it for shopping. That’s right – I said don’t use it for shopping. I know you’re tempted to whip it out to buy those cute shoes… but just use your debit card. “Credit shopping” is the quickest way to overwhelm yourself in debt; if you really want something and don’t have the money for it, ask for it for your birthday or a holiday… don’t charge it with money you don’t have.

2. Set a low credit limit on purpose. Step two of Operation: Debt Protect is to put a cap on how much you can actually spend with the card. I recommend, in the beginning, to set it around $400. Also, make sure to tell the bank to set your account to decline your transactions if you go over your credit card limit. Sometimes it allows you to charge things anyway, and that racks up tons of hidden fees and very high interest charges. This particular method ensures that you never rack up more debt that you can handle making monthly payments for.

3. Build your credit with small, everyday purchases. Everyday purchases (like a bottle of soda, or a sandwich) are much easier to keep track of and pay back. One strategy you can use that looks good to credit bureaus is breaking up your monthly payment into 2 or 3 spread out small payments. For starters, this lets you keep super solid control over how much you’re spending, and it makes minimum or full payments much easier to afford. Would you rather pay $30 all at once, or $10 every 8 or 9 days? Sometimes you just don’t have $30 all at once, so this strategy can be helpful depending on your situation. Personally as a former student, I found it useful because I always got low on funds between pay days… and sometimes my credit card bill was right before I got my next check.

Do yourself a favor and use these tips to smooth out credit card issues well before they happen. A student credit card is something that everyone should have because you NEED a credit history to do practically anything significant later in life (buy a house, buy a car, get a job, etc.) It’s all about being responsible.