Credit cards are an excellent way for college students to learn how to budget money and build a credit history. When used incorrectly, however, credit cards can create major debt for college students. Many credit card companies target college students by creating youthful ads, credit cards just for college students, and rewards programs designed to lure in students new to the credit card world. Knowing how to avoid overspending, late fees, monthly balances, and high interest rates can help you steer clear of the credit card debt trap.
Credit companies use a number of schemes to draw in student consumers. They frequently camp out near college campuses, advertising free t-shirts, frisbees, pizza, and other “prizes” if the student listens to a short sales speech or fills out a credit card application. Some students may sign up for the card just for the free stuff, with the intent to just cancel the card when they get it, but many end up keeping the card and using it for food, bills, textbooks, or tuition. Then they struggle to pay it off, incurring late fees, higher interest rates, and more debt.
Some states have passed laws to limit credit card advertising to teens and college students, but college credit ads and cards still abound. A few universities have gone so far as to help credit card companies recruit their students by selling a list of student names and contact information to the creditors. Students should always beware of sales schemes and only sign up and use a credit card if they believe that they can use it with discretion and reliably pay it off from month to month.
Before signing anything, always look at your interest rates – both before and after the introductory period – as well as what you will be charged for late payments and balance transfers. Taking 30 minutes to learn how to use your card wisely could save you from a lifetime of credit card debt.
If you are a college student and are struggling with a large amount of credit card debt, it is important to begin resolving that debt immediately to limit its effect on your future. For more information and assistance, please contact the experienced Milwaukee debt negotiation lawyers at the DeLadurantey Law Office, LLC today at 414-377-0518.