Ways to Teach Students Good Credit Management Skills!
For many students, college is the first opportunity they have to establish credit and manage it on their own. It’s easy to fall prey to overspending or mismanaging their budget. Many times, they rely on credit cards to make ends meet. This is a disaster waiting to happen with credit. Students must establish a good reputation as a borrower and college is the perfect time to develop credit management skills that will stay with students throughout life.
Here are three tips for students to establish good credit habits:
· Students should only have one or two credit cards. As soon as they graduate high school, many credit card companies bombard their mailbox with offers. It’s flattering for sure, but it can also bring unanticipated trouble. They don’t need a wallet full of credit. One or two cards are sufficient.
· Students need to set limits for what the cards will be used for. Credit cards should be used in cases of emergencies. Practicing good credit management means practicing discipline in regards to how to spend on credit. Students must determine their wants versus needs. (i.e., a $5 latte is not a need.) They need to know how much they can afford to spend on credit each month and make sure they pay the balance in full each month.
· Students need to pay their bills on time. This is one of the most important things they can do to establish a good credit score. This is why it is extremely important to not overspend and rack up a monthly balance if they can’t pay in full or more than a minimum monthly payment.
Having control over your finances is satisfying. You don’t want to be a slave to credit card companies or loan companies. Therefore, you must practice good credit management habits. This may mean giving up all the things that feel like necessities but are truly just wants. But short-term sacrifices can lead to long-term financial benefits and that’s good credit management anyone can become skilled at.
Here are three tips for students to establish good credit habits:
· Students should only have one or two credit cards. As soon as they graduate high school, many credit card companies bombard their mailbox with offers. It’s flattering for sure, but it can also bring unanticipated trouble. They don’t need a wallet full of credit. One or two cards are sufficient.
· Students need to set limits for what the cards will be used for. Credit cards should be used in cases of emergencies. Practicing good credit management means practicing discipline in regards to how to spend on credit. Students must determine their wants versus needs. (i.e., a $5 latte is not a need.) They need to know how much they can afford to spend on credit each month and make sure they pay the balance in full each month.
· Students need to pay their bills on time. This is one of the most important things they can do to establish a good credit score. This is why it is extremely important to not overspend and rack up a monthly balance if they can’t pay in full or more than a minimum monthly payment.
Having control over your finances is satisfying. You don’t want to be a slave to credit card companies or loan companies. Therefore, you must practice good credit management habits. This may mean giving up all the things that feel like necessities but are truly just wants. But short-term sacrifices can lead to long-term financial benefits and that’s good credit management anyone can become skilled at.
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