By Josie Dudek & Aubrie Smith, copy editors.
Do you know the ins and outs of credit? Chances are, you were probably never taught this essential thing in High School. And now, we’re in college, and we still don’t know what the heck we’re doing. Luckily, we did the research for you.
1. Open your own credit card.
This is such a scary thought, isn’t it? We hear all these horror stories about credit card debt racking up, and how much trouble they can get you into. Well, we’re telling you to get one! Credit cards can be very beneficial. They’re the fastest and easiest way to build up your credit and are essential to keeping your credit good. They’re a perfect way to show that you’re a responsible money borrower, plus, you get to live off of someone else’s money for a month, and that’s pretty cool! But, keep in mind that you should only use that card for small purchases. Credit cards can only get you in trouble when you overuse them. Start out small. Only swipe for that pack of gum, $10 gas fill up, or your mom’s birthday gift. When you start buying clothes, and other nonessentials, you’ll start racking up debt and spending money you don’t have.
2. Save your credit for emergencies.
When you don’t over swipe your card, you have money when bad things happen. Saving your credit will alleviate your stress when you need new tires on your car, or you really don’t have money to pay your electric bill this month. Saving your credit gives you an extra cushion of happiness when sad things happen.
3. Avoid being a co-signer for your friends.
Don’t get us wrong, your friends are great, and because you’re super awesome yourself, you want to be that person that helps them get their own credit card. However, this can backfire easily. We’re not saying your friends aren’t responsible, but when they get in a car accident and put all their repairs on their credit card, and then can’t pay them off, you’ll be stuck with that bill and your own credit will plummet. Suggest having their parent or a sibling cosign. If they can’t find anyone else, there are plenty of student credit card options that will approve someone for a low amount without a cosigner!
4. Keep your applications low.
This includes loan applications, credit card applications and housing applications.
Applying for these applications can impact your credit a ton. Each individual application takes a hit on your credit. Only apply for these things one at a time, with time between. And, if you have to apply for a few things all at once, wait a while before applying for the next thing. This will allow you to build your credit back up between applications.
5. Use your student loan money on school.
We know this is a crazy idea, but that money is for tuition, books and supplies. Those refund checks are great, don’t get me wrong, but if you put them in your bank account for the next semester, or better yet, make a payment on your loan, you’ll accumulate less debt, and be better off in the future.
These are only some of the ways to help you build and maintain positive credit during your college years. Just try to keep in mind what you want vs. what you need as far as purchases, and don’t give in to credit cards offered by retail stores, such as Victoria’s Secret. Once your credit drops, it can be very hard to get it back up, so be cautious and spend savvily!