Having credit cards has become a fact of life these days. Few people actually bother about carrying around cash since they know they can pay by credit. But when you’re still young and in college, consider giving this habit a rest and avoiding credit card debt in the long run.
Few people understand how people can fall into debt via a credit card. Since the card offers you “credit”, you are borrowing money from the bank to pay. When you return the money, the bank will ask for interest on this loan. This the part that racks up a huge debt and can often be a financial strain on college students and their parents!
To begin with, make sure you are using your credit card only for emergencies. If you can pay by cash or push the payment a few days without any problems, then keep your card out of the picture. This allows you to have minimal payments to make at the end of each month and plenty of money to save in your account. Such a habit is the best for avoiding credit card debt.
Consider sticking to only one credit card when you’re student. If you have two or more cards, the fees and payments can quickly pile up and have you under a mountain of pending debt even before you realize it. Stay away from temptation and manage your finances with just one card. At the same time, pay off all your bills on time and in full. The late fees charged by companies on these bills is often drawn from your credit and can become a big obstacle in avoiding credit card debt in the future.
When in college, it is important to set a budget for your monthly expenses. Once you have a budget in hand, you can figure out how to cut down on expenditure and keep your cash as a fall back option. Such financial habits help you in staying away from using a card or becoming dependent on it. At the same time, don’t change your credit plan without consulting an expert or your parents! Get the necessary information if you want to be avoiding credit card debt.
Finally, become prudent with your money and finances. Use on-campus banking facilities to learn more about how your money works and to conduct financial transactions. All of these things are necessary to keep your future financially secure and keep avoiding credit card debt for a happy life!