An Introduction to Credit Cards

On any given day most Americans receive at least one credit card offer in their mailbox. From the time a student nears high school graduation, and sometimes sooner than that, the credit card offers start rolling in. While receiving these student credit card offers can tempt just about anyone into applying for a card, it is important to first understand the responsibility of credit card ownership.

Having your own student credit card is first and foremost a privilege. In addition, it is also a convenience. A credit card provides its user with the ability to spend money with the swipe of a card and a flick of a wrist. It cuts down on the need for time-consuming check writing and the carrying money around town. Even better, it allows the user to pay for something even if he or she doesn’t have the money for it at the time.

But like all things that sound too good to be true, credit comes with a catch. This is not to say that credit is bad. That is not the case. Having a college student credit card and using it responsibly benefits the card owner in numerous ways. When a consumer uses credit, however, the money he or she spends has to be paid back. Because banks don’t lend money to people for free, interest is also charged on the balance of the credit card. This means that if you have a student credit card with a 20 percent APR and you buy a pair of shoes for $100, it will take seven months to pay off the purchase with a minimum payment of $15. 

Credit cards also have various fees associated with the use of the card. Some cards charge an annual fee of $30 to $50. Most cards will charge a $20 to $50 fee if you accidentally go over your spending limit. Your bill may also be subject to additional fees if you don’t bring your debt balance back to the credit limit within a timely manner. Credit is not something to play around with or take lightly.