What Every Student Needs to Know About Your First Credit Card

Many people wait until they have their college degree and have landed a full time job before applying for their first credit card. Although this seems like a responsible idea it could actually be a mistake.

A lot of credit card companies offer a first credit card to college students. They will send out credit card applications to students attending college offering them a credit card with a reasonable limit on it.

Some college students see this as a great opportunity and soon they have their first credit card in their wallet or purse. Others don’t see the value in accepting the card since they don’t have a steady income.

Establish a Credit Rating Early

Credit card companies believe that their money is secure when offering college students a credit card as they will hold the parents responsible for the debt if the student cannot pay for the charges. Although this may be the case sometimes, it’s not always, and the student can find themselves finishing college in considerable debt courtesy of their first credit card.

If the college student can resist the temptation to use the credit card foolishly than it’s a good idea to own your own credit card so that you can built a good credit rating. These days most credit card companies and banks will not give you credit unless you have credit and unless you have a loan or car payment, you will not have built up a credit rating. The fact of the matter is, that by the time a student finishes college, they can often be carrying a student loan and unfortunately, this means debt to the credit bureaus, but if you have already built a good credit history, you should be a safe bet in the eyes of anyone needing to look at your credit rating.

If you do receive a first credit card while in college use it sensibly. This means making payments on time and not using the card up to its limit. If you do charge the card to its limit you might find that your minimum monthly payments are being applied mainly to interest charges. This can end up taking years to pay off. Remember, you do not get anything for free. Use your credit card to charge only the essentials that you can pay off when your statement arrives.

A first credit card is the beginning step towards a lifetime of good credit. Apply for a low interest credit card and be very careful how and when you use it. The card is a reflection of you and not your parents so recognize and live up to the responsibility that goes with it.