Your first credit card as a student paves the way for your financial history. You must keep it clean and away from defaults to be able to get many beneficial financial help. A useful student credit guide is provided here that will ensure that you do not over spend and end up having a bad debt history early in life. Your first account can be like a double edged sword that can give you advantage as well as make you fall under financial debts.
Things to check for before you get your first credit card:
- Rate of interest: You can surf over the internet to find a company that offers lowest rate of interest. When you do so also make sure that you go through the terms and conditions of the bank. The rate of interest is important, as it determines the amount of money that you will be able to spend. You must also take into account your current financial standing, the mode of interest weather permanent or short term.
- Features of the credit card: In this competitive marketplace of credit cards; banks provide add on features on their credit cards to attract new customers. You must see what kind of rewards or redeemable points your credit card offers you. The best type would be the cash back offer. This will ensure that you can spend more amount of money.
- License/ Accreditation of the credit card company: Make sure you make a thorough background check on the company before you subscribe to their credit card policy. Since this is your first credit card you must take utmost care in every aspect. You can read reviews and testimonial online. Take into consideration the reviews offered by dissatisfied customers, and see how much that can affect you.
- Fees and charges: Make sure you are aware of the fees and charges that are required to be paid on your first bill. You must know that you will incur some initial costs to secure the card. You will also need to pay some extra financial changes. Also know the late payment charges, and annual fees that you will be required to pay. Make a research over the internet and ensure that you select a bank that requires you to pay the least amount of money.
When it comes to plastic money, students should get a credit card with lower cash limit, as they do not have a steady source of income, and paying the debt afterwards can become a troublesome affair. Students must not be tempted to spend more than they actually can repay. Growing debts will not only make the paying capacity burdensome, but also give poor credit score and hinder in obtaining a loan, when you actually need it.
Furthermore, it is best to stay clear of the cards that charge an annual fee, as this would not only hike the repayment, but what is the use of paying for a service that we intend to payback with interest. You should carefully weigh the APR rate of credits cards, before pouncing on any of them. The lower the APR the easier it is to payback the debt.