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Thinking about applying for
a credit card?
Qualifying for a student credit card is not based on your income. If you are 18, you could qualify
for one without your parent's approval. That means you
can get a credit card with a fairly high credit limit,
even though you don't earn enough to pay for it.
Credit cards will affect your credit rating, so consider
this decision carefully. Not paying your bills on time
can lead to a poor credit rating, which may hurt your
ability to buy a car or rent an apartment.
On a positive note, credit cards are a good way to establish
good credit. To do so, keep your balances low and pay
them on time. And it's a good idea to pay them off
monthly!
To make an informed decision, consider the
following before completing an application:
- Read the fine print. It provides
important information on late charges, over-the-limit
fees, annual fees, and interest rates. Some cards
have late fees as high as $30.
- Can you afford the minimum payment? Even if you don't have a job, you will be required
to make the minimum payment. Not doing so will result
in late charges and could increase your interest
rates.
- Beware of introductory interest
rates. Companies may advertise a low interest
rate but it often jumps substantially after a few
months.
- Don't apply for a card just because
they're offering cool, free stuff.
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