Credit Cards

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Ok, since I'm 18 I've decided to get a credit card so I can start building my credit up. I'm very responsible when it comes to money, and I don't plan on using it often, but I would like to know what a good credit card would be for a student like me.

 

The best one is a supplementary card from one of your parents.

 

I think at least a couple of credit cards offer ones specially tailored to students. I know Visa does. I'd check that out.

 

NOOOOOOOOOOOO! Don't do it! Seriously, don't do it. I was 18, was very responsible with moeny and didn't intend to use it often. By the time I was 19, I had 16 credit cards. By the time I was 23 I had $10,000 in debt. I bet you've probably started getting offers from credit card companies?
My advice? Open a checking account if you haven't already. Get a VISA checkcard as your ATM. Contrary to what a lot of people think and what a lot of credit card companies say, you don't need a credit card to "build up" your credit. Do you have a cell phone? If not, you could always get one and use it sparingly. Pay it on time and it will help. Though that can be tempting to just go a few minutes over your limit.
Since you are 18, you'll probably be going to college soon? If you are on your own, even if mom and dad help out, you don't need the added hassle of a credit card and credit card bills.
Do you have a job with a decent income? If you have some money saved up, around $5000 or more, talk to a financial advisor about investing. A mistake many people make is not investing at an early age. You can also by a copy of the Wall Street journal. Look inside for an institutioin where you can set up a money market account. It will work just like a checking account. You'll have checks to write and some even give you the VISA checkcard. The bonus? You'll receive interest on the account and it is usually twice as much as a checking account from a bank.
If you simply must have an actual credit card, have your parents get a card issued to you. But have it be a balance of only a couple hundred dollars. The downside of this is if you run up a bill of thousands of dollars, your parents can and will be responsible as well.
Also, make yourself a weekly and monthly budget. And do it on paper. It helps with money when you visually see were your money is going.
Good luck!

 

Elios makes some very good points - it's easy to abuse credit cards and get into serious trouble. He's right in saying that it's never too early to start investing. Don't be afraid to be a little aggressive, either - you have almost 60 years before you have to retire on that money, and that's plenty of time to make up a loss or two.

That said, a credit card is a handy thing to have. Make sure you find a basic card with no annual fee - you probably won't need all the "services" it would pay for anyway. Whatever card you get, PAY OFF THE FULL BALANCE EVERY MONTH!!!!!!!!!!!!!!!!!!!!

 

Well investing is an option, but at the moment, I can't afford any financial setback (in college) so unless there's this 'microsoft to be' kind of opportunity, I think I'll pass.

 

Unfortunately credit cards do become a necessity at times. Like when you want to rent a car, motel room, book an airline flight. Try paying cash for an airline ticket. Virginia farm boys will be tailing your butt all the way. And a lot of car rental companies and hotels won't accept check cards, but some will. I'd only use them like for gas and maybe groceries. But like BTA says, if you don't have the money in the bank to pay it off, don't use.
I found when I go to the store and buy something, I first ask myself, "Do I really need this? What else could I use this money for?"
Since you're in college, I'd look into taking a personal finance and consumer economics class. One of the best classes I've ever taken. And it usually can apply as an elective towards almost any degree program.

 

Thanks for all the advise. I did a little web surfing and found two cards I really like, but I think I'll be getting the Capital One "No hassels" card.

 

The deal with Capital One is they will give you a card if you're a student. On the premis that your parents will cover the bill, if necessary.

Statistically, it works for them.

After you get a job, you can ask them to lower your percent rate, and up the limit.

Mind you, this is to start. I still have a Capital One card that has a pretty low limit. I use it strictly in places or for things that I consider "high risk". Paypal, gasoline, internet shopping. I pay it off, completely, every month. Which probably pisses Capital One off, but I care not.

My other card has the large limit. The one that could seriously dampen my spirit if it was used for evil. I don't typically carry a balance on it, but I have here and there for a few months at a time.

Credit cards are wonderful tools. I like to be able to pay at the pump when it's -10C, with a -25C windchill. But, you must have the responsibility and patience to use them correctly.

Thwart the Bankers. Let not the Bankers thwart you. Shoot them in the belly. Make them die for their country. Leave them to rot for all eternity in the Ninth Hell.

 

Heh...I have no qualms with pissing the credit card company off.

 

I personally never liked Capital One. Whenever I called, the people were always rude. I missed a payment here and there and they hounded me relentlesly. It took an act of God and congress when I wanted to cancel my card. By the way, there's another tip; if you get a card, stay with it. Switching cards too often can also look bad on your credit report.

 

Why do you need credit on your credit card? I finally got around to get myself a VISA and when they asked me if I wanted credit I said hell no! I can use everywhere, it was my main way of paying when I was in the states and it works like a charm. No bills no nothing, you have what you have but no need for pesky bills. I have never understood the purpose of having credit at all. It feels kinda backward to me.

 

I have been playing the credit card game for a long time now! I remember the days when I couldn't get a credit card because I had "No Credit History" For the beginner start out with one and pay your entire bill every month! When you get more status you can have three or four and play the balance transfer game Man, I love those 0% for six months

 

It's true.

Anyone will give you a "secured" credit card. Usually there's a minimum limit (most are around 600). But if you have really, really poor credit or you don't have any credit at all, it's quick and easy to sign up for.

 

I got my Visa from my local credit union. The way to go for credit, as far as I'm concerned. Mt bank actually knows what's going on, which was helpful when a payment got "lost".
Mine only has a limit of $500, by my choice.
But if you really want to build credit, take out a loan. I went from 0 credit to loan sharks panting to give me money after my first vehicle loan. Funny thing is, I got the car loan 6 years before getting a credit card.

 

A credit card really is that.

It's a load. A Visa loan. Mastercard loan. American Express loan. That is what it really is; unless it's secured, of course.

And yes, loans are good to start out with. I'm just saying that a secured credit card will give you the functionality of a credit card. Can't exactly pay with cash on the internet, and money orders take time to transit the mail. And the last thing I want to broadcast is my savings or checking account number and routing.

Which is the sole reason I will never confirm through Paypal. Unless I open a seperate account, at another bank, specifically for Paypal and internet stuff.

I mark and shred my "voided" checks.

 

If you cant afford something you cant afford something and you cant buy it. How hard is that? But most of the time on more expensive stuff, especially electronics you can pay alittle a month with little or no interest. If the stores didnt offer cheap paying plans for their customers they wouldnt be able to sell anything.
I would like to ask what the average interest is on the major credit cards? Oh and my dislike of credit on credit card must be a cultural thing, I have been raised all my life that credit cards are bad and that the only time you should loan money is when you buy a house or car and then loan from the bank. That is the common sentiment here, pretty strange how even small things can change from country to country. Swedes seems to be horribly afraid of being in debt.

Ejsmith, I pay with my VISA on the net, but it is only connected to one account, my 'spending' account. There I only have at most 300-400$. If something should get hacked they cant touch my savings as they are on a whole different account (with better interest of course) and when I start to run out of money or if I am going to buy something expensive I just transfer money from my savings account to my spending account. Internet banking is really nice and comfortable.

[ February 11, 2003, 09:58: Message edited by: joacqin ]