<p>My bank did not hold me liable for any of the money screwed with when my identity was stolen, and almost $20,000 was in limbo. That's not pocket change. However, the credit card debt took months to correct. </p>
<p>I am of the camp that most students are simply not responsible enough to do all their spending on a credit card. It's far too easy to spend more than you have because you're not spending against money, you're spending against a credit limit. Since the average college student graduates with $7,000 in credit card debt, if you don't feel you need one, simply don't get one, or open the account and rarely use the card for a small purchase to lengthen your credit history.</p>
<p>No reason to have one just for the sake of having one.</p>
<p>Somehow I managed to end up with a credit card with a $5,000 limit while still in high school. I'm not real sure how that happened...I guess my parents have good credit and they assumed that since I was young, my parents were going to be paying for it anyway and not me. I also have a check card from the bank which can be used as a debit card, but I've never used it that way. </p>
<p>It makes me feel a bit nervous for some reason to wander around carrying a hundred in cash with me (and then after you spend it, you have to go and get more) so I generally just use the cards except for purchases under $20 or so. I always pay the balance off at the end of the month, and I always know how much money I have in general so I'm not about to go on a big shopping spree just because I could theoretically buy things on credit. </p>
<p>I do think that using a card in general tends to make you less aware of how much you're spending, just because you're handing over a piece of plastic and not a wad of cash and you don't actually see the money disappearing. But you have to learn to manage money sometime and you may as well do it in college, when your parents can still support you if you mess up.</p>
<p>I think I need to get ahold of one of these credit cards with rewards someday, though.</p>
<p>Debit cards are a real pain in the ass (at least for me). I was trying to buy some stuff online and then canceled the order when i found the items to be out of stock. A few days later I checked my bank and saw that there was like $400 being withdrawn...but not getting anywhere. I called the bank then the merchant and both said the other has to cancel it. Im like ***. Anyway the ongoing saga continues...</p>
<p>Then I try to apply for a credit card and finds out somehow I need a utility bill in my name in order to apply for a student card...</p>
<p>i have to admit, i think you're pretty wrong on this one. if used responsibly, a credit card is vastly superior to a debit card. If you are worried about interest rates and having huge debt, get a low limit credit card ($500). If you're worried about carrying a balance and paying interest, get a charge card instead of a credit card. You must pay off charge cards every month and you cannot carry a balance - therefore no interest. My parents gave me an amex when i started college and I havn't found myself unable to pay it off once yet, nor am in $1000s of credit card debt. However I have overdrafted a few times (i have a low balance checking and a high balance savings which i just transfer as needed), and at $35 a pop, that has cost me a pretty penny.</p>
<p>the fact is if used responsibly, credit cards and much safer, cheaper, and beneficial than debit cards.</p>
<p>Just a warning when going to get your debit card, do the paperwork & everything you have to do to get it about a month before you plan to first use it, some banks (like mine!) are super slow in sending them out & it's not fun rushing around at the last minute waiting on that thing to come in the mail.</p>
<p>
[quote]
But it is important to have both a history of fixed loans as well as revolving credit, so having a car loan with a cosigner or a small personal loan that you pay off on time as well as a credit card where you use LESS THAN 30% or so of your available credit limit and pay in full each month would be perfect.
[/quote]
A dumb question, but... Does that mean that spending more than 30% of your credit limit hurts your credit rating?</p>
<p>(edited to add, of course I will be paying it all off on time...)</p>
<p>Generally, your credit report is updated every time you receive your monthly statement from your credit card (that is usually when a credit card company sends its information on you to a credit reporting agency). If, at the statement date, you are utilizing too much of your credit line (some say 30%, some say 50%), that will hurt your credit. Note, however, that if you subsequently pay this balance, your credit will return to where it originally was once your $0 balance is reported (most likely your next statement date).</p>
<p>Some thing on your credit report stay for a period of time (such as applying for new credit, paying late and declaring bankruptcy), whereas other things change frequently and can be improved right away (such as paying down your credit lines).</p>
<p>If you need to make a big purchase and will have some debt for a short period of time, it's not a big deal as long as you're not planning on applying for anything (such as a loan or a new credit card) around that time.</p>
<p>One thing reported to companies (such as insurance companies) when checking your credit is what % of your available credit you are using on average. You want to try to keep that below 30% (and definitely below 50%). Doesn't mean you can't ever go above that number, just make sure on average you have less than that. So if your credit limit is $1500, try not to run up more than $450 worth of charges before you pay it off, and definitely keep it below $750 if you can. If you find yourself paying $500, $600 or even $800 at the end of each month, you should really try to keep your spending down (or see if your credit card company will raise your limit, although the former is better advice for money management than the latter)</p>
<p>^ great advice (also automatic payments are a good idea to make sure you're never late, just make sure you still READ your statement and don't just let it take care of yourself to watch for fraud and to make sure you don't owe more than you have in your bank account)</p>
<p>Thanks :) What I'm really wondering is, if I buy my textbooks on my credit card (so a big bill 3X a year), is this too much? I've got a $1000 limit, and since I'm new to college I'm not sure how much books are going to end up being...??</p>
<p>Yeah, so obviously I'm new to this whole credit thing...all I know is, don't spend what you don't have and pay your bill on time. Building credit is entirely foreign to me :)</p>
<p>i had a credit card stolen during college. i noticed it was missing, called the company, they asked me what the last thing i charged was, froze my account as of the day i last used it (one charge was made after that day)(=, and i had a new card in my hand two days later.</p>
<p>yeah, it can be a hassle temporarily if one is stolen and thing after thing are charged to it, however most normally cc companies will help you get that straightened out pretty quickly. I mean, i just had a minor problem and two days later it was taken care of.</p>
<p>and if you guys really feel a credit card is unlimited money and aren't responsible enough to keep track of it, well then i don't think you're responsible enough for a lot of things... like college.. how on earth do you get your stuff handed in during college without your mom there holding your hand and forcing you to do it? noone is telling you to get it in, you just KNOW that's your responsibility to have it in by that time. same thing with a credit card. noone is telling you to stop spending, however you just KNOW how much money you really have and can afford to use towards the credit card. and it takes 2 seconds to register your card online and keep track of your balance.</p>
<p>most banks do however there are some banks that are still in the stone age that don't do the whole visa/master card thing and just use a standard atm/debit card and those are the ones that lack protection... at least from my experience anyway.</p>
<p>Yeah...but those aren't really debit cards thought, right? I mean, I don't think that in those cases you really have much to worry about because you'd still need your pin to use it.</p>
<p>Unless you print your pin on the card. In that case, you deserve to lose your money, you dolt.</p>