2008 Woodie Awards
Read the fine print on credit card applications
By: Adashea Davis
Issue date: 8/23/07 Section: Money Matters
- Page 1 of 1
Credit card companies often try to woo college students to apply for their product with the "free gift" tactic.
This gimmick may be tempting, but should not be the only deciding factor, said Tanya Marcum, assistant finance and law professor.
Marcum said it is important for students to look for low interest rates and avoid membership fees.
"Your first credit card should have a low credit limit so that you don't over-spend," she said. "Avoid compulsive purchases."
Grand Blanc senior Katie Bennett said she doesn't keep a balance on her credit card, which she's had for six years.
Understanding the repercussions of late or missed payments can be a way to decide if the credit card is a right fit, Bennett said.
"It's a good way to learn responsibility," she said.
Like all contracts, when you sign off on a credit card agreement, the contract is enforceable in court, Marcum said.
"Read the fine print and understand the terms of the agreement," she said.
Credit information is recorded by a consumer reporting agency (CRA) in a credit report, which details borrowing and repayment of past bills.
The three main CRA's are Experian, Equifax, and Trans-Union.
Having the balance paid in full every month can have a positive effect on your credit report.
Even credit card denials show up on your credit report.
Employers also can use a credit report in their hiring decisions, Marcum said.
Much like having bad credit, having too many open credit card accounts can lessen employment opportunities as well, she said.
Ways students can build up their credit include starting a cell phone account or paying utilities for an apartment.
"It takes about six months to build up good credit," Marcum said.
Conklin sophomore Lindsey Noel said there's a reason she doesn't have a credit card.
"I'm afraid I'll go into debt," she said.
St. Ignace senior Gina Della-Moretta said she also doesn't trust herself with a credit card. It would be too tempting to use it for her daily coffee purchase, she said.
Bennett and Noel agreed the decision to get a credit card should be made on a person-to-person basis.
Noel said, "It depends on if (the student) can control their spending habits."
news@cm-life.com
This gimmick may be tempting, but should not be the only deciding factor, said Tanya Marcum, assistant finance and law professor.
Marcum said it is important for students to look for low interest rates and avoid membership fees.
"Your first credit card should have a low credit limit so that you don't over-spend," she said. "Avoid compulsive purchases."
Grand Blanc senior Katie Bennett said she doesn't keep a balance on her credit card, which she's had for six years.
Understanding the repercussions of late or missed payments can be a way to decide if the credit card is a right fit, Bennett said.
"It's a good way to learn responsibility," she said.
Like all contracts, when you sign off on a credit card agreement, the contract is enforceable in court, Marcum said.
"Read the fine print and understand the terms of the agreement," she said.
Credit information is recorded by a consumer reporting agency (CRA) in a credit report, which details borrowing and repayment of past bills.
The three main CRA's are Experian, Equifax, and Trans-Union.
Having the balance paid in full every month can have a positive effect on your credit report.
Even credit card denials show up on your credit report.
Employers also can use a credit report in their hiring decisions, Marcum said.
Much like having bad credit, having too many open credit card accounts can lessen employment opportunities as well, she said.
Ways students can build up their credit include starting a cell phone account or paying utilities for an apartment.
"It takes about six months to build up good credit," Marcum said.
Conklin sophomore Lindsey Noel said there's a reason she doesn't have a credit card.
"I'm afraid I'll go into debt," she said.
St. Ignace senior Gina Della-Moretta said she also doesn't trust herself with a credit card. It would be too tempting to use it for her daily coffee purchase, she said.
Bennett and Noel agreed the decision to get a credit card should be made on a person-to-person basis.
Noel said, "It depends on if (the student) can control their spending habits."
news@cm-life.com
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