Wednesday, September 08, 2010

Students, beware of Credit Card Teases

A new semester, a new stage in life, and a promising future, all await young students who will also slowly learn the "ways of the world." Year after year we hear about the cost of attending post-secondary institutions - that loans are not enough, books, and living costs are so much, and there is incredible debt to repay once a program is complete. It's ironic that those very students who will accrue the burden of heavy loan repayments, are often the main targets of banks and credit card companies. Just a word of advice for students. If you are tempted to accept a coupon for a free chicken snack pack, or get a free frisbee, or free cheap gadget, pen, poster, or anything free, then please think twice about it! If the deal involves signing you up to get a new credit card, ask yourself, do you want even greater debt? Or do you want to reduce debt, and save?

As a student, there are essentials, like texts, notebooks, rent, and food, but there are other "non-essential" expenses, that you can control the spending for. For many, perhaps most students, credit cards may be labelled a "non-essential". Question everything.

People may have different reasons for wanting a credit card, but just because it could be your first one, or another symbol of transitioning into adulthood, is not a good reason for it. Think about who benefits from your future credit card debt, who else, the companies and banks... laughing all the way back home, to the bank.

Keep in mind, that the interest rates are insanely high, and this is what helps them make their record profits from quarter to quarter. It will put you in more debt, and often times, it just is not necessary. In fact, there are many better options to increase your income as a student. MUN for example, offers 100s of part-time jobs like the MUCEP program. Do not be lured into increasing your future debt, but focus on keeping it to a minimun, and having more money now and in the future just for yourself and your needs.

There are several money managing sites that provide savings and spending tips, and online financial calculators to help budget. In fact, you can actually find out how much your program will cost, and how much you may spend or save on essentials and non-essentials.

Good luck students, enjoy your time while studying, and take care of your money, or someone else will.


Anonymous said...

I can honestly say I have one credit card and I have never used it, and don't intend to after reading this.

If you don't have the money on hand to buy it why use a credit card?? you still need to cash to pay double the price for it when you statement comes.

Great story Charlie~~

Lynn Osmond

Charlie said...

Thank you for the comment Lynn. You are wise to avoid using it. Yes, far too many people do not think about the high cost of using those things, and many students who are typically mesmerized by their book purchases, class schedules, coordinating living spaces, food, etc., do not give a lot of time to think about the implications of credit cards, or want to even bother perhaps. Financial institutions know this, and take advantage.

Good luck to you Lynn.