How Many Credit Cards Should College Students Have
Many college students want to have credit cards for paying college expenses such as food, and textbooks. Getting a credit card is helpful for college students because it gives them the opportunity to build up a responsibility in keeping their finance in good state and also to develop a good credit score. Since this is the first time you get a credit card, you should only apply for one credit card. You should first learn to manage one card first.
If you can manage one credit card well, you can apply for multiple cards when you graduate. While you are in college, you have a limited income with a lot of college expenses to cope. You are probably taking a part time job to cope with your college expenses. Applying for multiple cards can put a burden in you and make it hard for you to cope with your college expenses.
Many students can’t control themselves in spending money when they have multiple credit cards. They simply take any of their card out to swipe and charge without thinking whether they are going to be able to pay it. This will bring burden to your parents because they are your cosigner and they will have to pay for all the balances you charge to the cards when you can’t pay.
Lots of students have left college with a huge burden of debt to pay when they start working. Survey shows that young U.S. households are the group that have the second highest bankruptcy rate in the USA. To prevent yourself from getting trapped in debt, it is wise to just apply for a single credit card.
It is hard to track your spending when you have multiple cards. Besides, there are many due dates that you have to keep track when making repayment. The credit utilization ratio determines your credit score. The more available credit you have, the higher the credit utilization ratio will be so having just one credit card is the best.
One card is sufficient for you to build your credit by paying all your balances promptly on the due date. Credit cards for college students will offer protection against fraud loss for up to $50. You should never charge the card more than 30% of the available credit. When you have one credit card, it can be easy to exceed this limit when you are charging your card for purchases.
It is recommended that you pay cash whenever possible and avoid charging it for all your daily expenses. You can use the free online credit score monitoring tool to monitor your credit score. Building up your credit score is important because it will serve as an important credit reference when you apply for a new personal or car loan upon graduating. It is also necessary to show your credit report when you are applying for a new phone.