Are you a college student looking for Credit Card?

When college students get their first credit card, it’s their first step towards building financial independence. College students may use it recklessly or not use it at all; developing a bad credit score is not an option as it will reflect in all of your future financial transactions. Building a good credit score is as important as maintaining a strong GPA.

Importance of good credit

This is vital when you get a credit card; it’s how you manage your expenses. It can either determine a financial success or a battle for years trying to pay your credit card debt. A good credit history opens many opportunities, like purchasing a house or getting a car loan. Whereas, on the other hand, credit card debts can lead to bad credit score, unnecessary fees, high-interest rates and lower credit limits.

Choosing your first credit card

Credit cards are different; every credit card serves a different purpose, especially a student credit card. As a student, you must take some time out and research on the various credit card eligibility criteria and choose the one that fits your needs.

Credit card Terms

As you’re new in the credit card world, you must familiarize yourself with all of its terminologies. Some frequently used terms are –
Annual Percentage Rate (APR) – Your APR is the amount of interest you will be charged for carrying a balance month-to-month. You must always consider 0% or very low APR offers and factor in the penalty APR. The penalty APR is the interest rate applied when you’re unable to make a minimum payment. So it’s very important to know how much your APR is.
Fees – Annual fees are one such fee to avoid. Certain student credit card has annual fees, also there are application and processing fees, before getting a credit card make sure to read the terms and conditions carefully.
Rewards Program – You can make the most of your spending and expenditures if your credit card comes with a rewards program. You can get up to 1% -5 % of cash back rewards in several categories.
Use your credit card wisely
Following are certain tips that will help you in using your credit card wisely –
• Pay your bill on time – I cannot emphasize this point more, you have to pay your credit card bill before the due date every month. Even if once you don’t pay your entire amount on time, the amount will be carried forward to the next month with some charges applied.
• Know how much you can spend – The thumb rule of having a credit card is to know how many items you can buy with the credit card and will you be able to pay the subsequent bill?
• Stay under the limit – Always stay under your credit limit, this is also one of the golden rules of good credit management.

If you’ve understood the aforementioned pointers then go ahead and apply for a credit card. Remember don’t abuse or completely abstain from using credit cards.

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