For those of you who are unsure what credit is, it’s the amount of money a person or bank lets you spend with the understanding that you will pay it back in the future. Have you thought about getting a credit card or are you scared that you will overspend if you decide to get one? Here are some helpful tips for diving into the unknown waters of adulthood and good credit building!
1. Remember that you have to pay the money you borrow back. One of the best ways to insure that you’ll have enough money to pay back what you borrowed is to only charge up no more than half of your monthly income. For example, if you make 400 dollars over the course of a month only 200 dollars should be charged to your card.
2. Don’t just make the MINimum payment. All credit cards accumulate some form of interest. Interest is a charge from the percentage of the money borrowed. If you owe the bank 150 dollars, your minimum payment may only be $25. The issue with just paying the minimum payment is that your account will begin to accumulate interest, so instead of paying your original $150 you may be eventually paying 2 times as much. On the other hand, if you pay the $150 instead of the minimum payment NO interest will be added on to your balance due.
3. Don’t get a credit card from your favorite clothing stores like American Eagle, Victoria’s Secret, or Old Navy, etc. The best place to get a credit card is through your original bank/ the bank you have a checking account with. A lot of banks like Wells Fargo and Bank of America have college student credit cards, which include special rates. By using a bank you have a checking account with it is easier to make payments and check your accounts through mobile apps. It is also a great way to establish a good relationship with your bank.
 4. Don’t be greedy. Don’t get more than one credit card. If you get more then one credit card you will have to many chances of over spending or loosing control of payments.Â
HCXO!