Top five mistakes college students make
Top Five Money Mistakes College Students Make
College students face many hard financial decisions. As a young adult they need to figure out how to pay for college, earn some spending money, and still get a good education. This is a tall order for anyone, so it’s no wonder that many college students end up making some costly money mistakes. Unfortunately, these mistakes can actually cause damage that lingers for decades, so making sure your finances are in order even as a college student can go a long way in helping you get a good start after school.
College Student Money Mistake #1: Credit Card Debt
Credit cards have become a way of life. They make paying for things extremely easy and with many cards offering rewards programs or cash back it’s easy to see their appeal. The problem is that the appeal often overshadows the drawbacks. Many cards have high interest rates, unfavorable terms, and allow students to spend more money than they actually have. In fact, if you get into the habit of only paying the minimum payment each month you could be stuck trying to pay off the card for over ten years!
Keep in mind that credit cards can play a vital role in establishing your credit history, so that doesn’t mean credit cards should be avoided. Instead, credit cards should be used to help built a solid credit history and the balance paid off in full each month. This will allow you to still collect the rewards or earn cash back while not having to deal with finance charges and long repayment periods.
College Student Money Mistake #2: Ruining Your Credit Score
While we’re on the topic of credit cards it’s important to highlight the dangers that can come with going into credit card debt. Many college students end up completely trashing their credit history by just making a few poor decisions. Remember, missed payments or other negative marks will remain on your credit history for seven years and trash your credit score. Yes, seven years! That one late payment you made
College students face many hard financial decisions. As a young adult they need to figure out how to pay for college, earn some spending money, and still get a good education. This is a tall order for anyone, so it’s no wonder that many college students end up making some costly money mistakes. Unfortunately, these mistakes can actually cause damage that lingers for decades, so making sure your finances are in order even as a college student can go a long way in helping you get a good start after school.
College Student Money Mistake #1: Credit Card Debt
Credit cards have become a way of life. They make paying for things extremely easy and with many cards offering rewards programs or cash back it’s easy to see their appeal. The problem is that the appeal often overshadows the drawbacks. Many cards have high interest rates, unfavorable terms, and allow students to spend more money than they actually have. In fact, if you get into the habit of only paying the minimum payment each month you could be stuck trying to pay off the card for over ten years!
Keep in mind that credit cards can play a vital role in establishing your credit history, so that doesn’t mean credit cards should be avoided. Instead, credit cards should be used to help built a solid credit history and the balance paid off in full each month. This will allow you to still collect the rewards or earn cash back while not having to deal with finance charges and long repayment periods.
College Student Money Mistake #2: Ruining Your Credit Score
While we’re on the topic of credit cards it’s important to highlight the dangers that can come with going into credit card debt. Many college students end up completely trashing their credit history by just making a few poor decisions. Remember, missed payments or other negative marks will remain on your credit history for seven years and trash your credit score. Yes, seven years! That one late payment you made