Home gambling commission 3 pitfalls to avoid as a recent college graduate

3 pitfalls to avoid as a recent college graduate

0


When you graduate from college, you are faced with a plethora of financial choices and new responsibilities. If you’ve landed a job, your new income might also help you access financial products that you couldn’t before, such as reward credit cards.

But before you sign up for a card or start using one on a regular basis, it’s important to know the top three pitfalls to avoid.

1. Choosing the wrong credit card

The CARD Act of 2009 restricted the way credit card companies can market to students and made it more difficult for students to obtain a card, but new graduates can be left with a plethora of choices. cards.

It’s important not to rush into signing up, even if you’re tempted by the promise of a signup bonus or other perks. You want to find a card that:

  • Offer bonus rewards that match your shopping habits. For example, if you spend a lot on groceries now that you’re no longer on a dorm meal plan, you might want a card that offers bonus rewards for grocery purchases.
  • Does not charge any annual (or reasonable) fees. While paid cards are sometimes worth it if the benefits of the card justify the costs, make sure you get the benefits you will be using before paying to become a member of the card.
  • Does not impose other costly fees that may apply to you. For example, some cards charge foreign transaction fees. If you plan to travel abroad often for business or pleasure, you probably don’t want to.
  • Has a new member signup bonus that you can easily earn: Cards often offer incentives, such as $ 250 in cash after signing up, but you must meet spending requirements to earn them. If you don’t spend a lot as a new grad, there’s little point in signing up for a card to earn a bonus that you won’t be eligible for.

Research the card options carefully – there are a lot of them out there.

2. Charge more than you can afford

Credit card interest rates can be very expensive. If you pay off your card in full each month, it doesn’t matter, you won’t pay interest. But if you charge more than you can cover when the bill comes in, you end up owing interest charges.

If you do not pay your balance in full, the interest increases your purchases and commits you to a new monthly payment. When you use tomorrow’s income to pay yesterday’s bills, you’re less likely to live within your means and more likely to end up with even more credit card debt.

Avoiding this is crucial. Keep a close eye on what you’re charging and stop using your cards before your balance hits a level you can’t pay off.

3. Forgetting to pay bills

It’s easy to let things slip through the cracks when you’re just starting out. Unfortunately, missing a single credit card payment can damage your credit score for years. You don’t want a score that interferes with your ability to buy a car or qualify for a mortgage because you forgot to make a payment.

To avoid this, set up SMS reminders or calendar reminders for a few days before your payment is due. Or, if your budget is tight and you’re sure you can pay off your card in full, consider setting up automatic payments so there’s no chance you will miss your due date.

By avoiding these three pitfalls, you can ensure that your credit cards are helping you earn rewards and grow your credit without going into debt. They can be a great tool in building your financial future, as long as you use them in a meaningful way.


LEAVE A REPLY

Please enter your comment!
Please enter your name here