Credit Card Management - Iowa College Access Network - ICAN

Credit Card Management

Credit cards are a handy way to buy things without cash. But as a college student, you need to decide if you should be buying anything you can't afford. Remember, every time you use your credit card you're basically taking out a loan. With interest charges and fees, credit card debt can quickly grow out of control.

Decide If You're Ready

Use these questions to help yourself decide if you're ready to use credit cards.

  • Do I really need a credit card?
  • Do I have the self-control to handle a credit card responsibly?
  • Can I afford a credit card, including the interest charges and other fees that may apply?
  • Will I be able to pay off my balance in full every month?

Advantages of Credit Cards

Credit cards do have some good features, even for poor college students. They can:

  • Be convenient. Using a credit card is fast and easy at the checkout.
  • Build credit. If you pay off your balance each month, you're building a good credit history.
  • Handle emergencies. If your car suddenly needs a new battery or you have an unexpected medical situation, a credit card means you can pay off a bill in smaller, more manageable increments.
  • Earn rewards. Some cards give you points that you can cash in for things like airline miles. (Remember, these things are not free, but earned by buying a lot of other things.)

Disadvantages of Credit Cards

The flip side of credit card use is not so great. Every decision you make with a credit card makes a difference for the future. Remember:

  • A credit card is not free money. Credit card charges are really high-interest loans that may take years to pay off if not handled responsibly.
  • Making your monthly payments is important. It's best to pay your full balance each month. If you don't, you'll pay more than the item's actual cost because interest charges will be added.
  • Misusing a credit card can damage your credit history for years. Bad credit can hurt your ability to rent or buy housing, borrow money or find a job in the future.


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