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    Credit Cards On Campus
    Gina Doynow
  VP and Director of College Marketing
  Citi Cards

Credit cards have become a fact of life for many college students. Learning how to choose and use a card is an important first step. Here are some things you should know before you apply for your first card:

Living on a budget and managing money are challenging lessons for many of us, especially college students learning financial responsibility for the first time. Yet it's a lesson worth learning because, for many, a credit card will become a powerful and indispensable financial tool. Credit cards can benefit college students in many ways. Having a credit card in your own name can help you build a good credit history, an important asset when you are ready to apply for car loans, apartments, jobs or even a mortgage someday. It's often easier to get a credit card while you're still in college because credit card companies see students as good long-term customers that they want to build a relationship with now.

A credit card can be a very powerful tool for students. There is no safer and more convenient way to make purchases if you shop on-line or over the phone. A college student in an emergency situation will appreciate the purchasing power of a credit card, especially if you ever have an urgent need to get a car towed or repaired, fill a prescription, or travel home.

Using credit cards as a convenient way to pay for things you know you can afford is smart. Using credit to extend your income to pay for things you can't afford will only increase your debt.

Along with the benefits of owning a credit card comes responsibility, which, if mishandled, can cause serious financial problems. While many students can get a credit card, the key is to make sure you have the right support to use that card wisely. Students can get into more debt than they can handle, and if you start misusing your credit card, you can create a negative credit history that will follow you long after graduation. Don't confuse credit cards with free money. It's okay to use a credit card to make purchases, but remember that you will have to repay the money you spend and possibly interest if you don't pay in full each month. Therefore, use your credit card wisely and sparingly.

Don't apply for every card you're offered just to get a free gift. It's a nice bonus but should not be the reason to choose a card. Students should read over credit card agreements carefully. Then, determine your needs and choose the best card based on the benefits and services the card has to offer.

Your budget and spending habits should be a factor too. Some students have a card with a rebate or reward feature they use for all their regular expenses every month, then pay the bill in full when it arrives. This is a good strategy for charging gas, meals, and other day to day expenses. Other students carry a card with a low interest rate that they use primarily for financing larger expenses, such as travel or computer equipment.

Make your payments on time, every time, and always stay within the credit limit set by your credit card company. If you pay late or go over your limit, you'll not only pay a fee, but it can appear on your credit report for future lenders to see when evaluating you for other loans or financing. Don't apply for more credit cards than you need, too much available credit can make you look like a risk to future lenders.

Learn how to read the fine print on a credit card agreement. If you pay for a purchase over time, you'll pay interest based on the APR, or annual percentage rate. If you plan to pay your bill in full every month, the interest rate is less relevant for you than other fees. Be sure to compare annual or membership fees, cash advance fees and balance transfer fees.

Getting educated on money management is the key difference for students to successfully use credit cards to their advantage. Students who learn how to manage credit early on will be more likely to stay on the right Financial track during college and beyond.


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