The time has finally arrived…graduation. Whether it is graduation from high school or college, it is a time for celebration. It is also time to look for work and, unfortunately, learn to live in the adult world. That means managing your own money. Once you are gainfully employed, you may find yourself receiving pre-approved credit card offers. They will sound enticing, after all who doesn’t want a few pieces of plastic in their wallet. If you are not careful, you could soon find yourself with a half dozen cards or more and a sea of debt. Here are a few rules new grads should follow when they start dealing with credit cards.
- All cards are not equal. Read the fine print carefully. Look for the card(stick to one the first year) with the lowest yearly fees, late fees, over the limit fees, and interest rate. Reward cards should be avoided.
- Pay every bill on time. Go to the length of setting a reminder on your smartphone or writing the due date on your calender if you have to. Paying late usually raises the interest rate and comes with a hefty fee of up to $50 each time. Then there is the negative information that will appear on your credit report.
- Pay your bill in full each month. Sure, the minimum payment is much easier to make, but it will not reduce your debt by much and making the minimum allows your debt to escalate too easily.
Personal finance may not be an area that you have learned much about. Treat it like a class project and do plenty of research. Jumping into the adult financial world blindly can cost you a lot more than you realize. You don’t want to be fresh out of college with student loans to pay off and find yourself in need of credit card consolidation in Ft. Lauderdale – what a bummer that would be!