david b.
Posts: 2894
Joined: Fri Jun 15, 2001 7:18 pm

Student Credit Problems

Fri May 02, 2003 10:24 pm

Are credit cards designed for high school/college students?

I ask because a lot of people I know are in debt and have bad credit because of it. Some of them are making minimum payments for as long as I can remember. Anyone else have this sort problem and how can it be solved? A lower credit limit until a certain age?

I have one credit and one debit card. I don't want anything more.
Teenage-know-it-alls should be shot on sight
 
Matt D
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Joined: Fri Nov 19, 1999 6:00 am

RE: Student Credit Problems

Fri May 02, 2003 10:40 pm

a lot of people I know are in debt and have bad credit because of it. this sort problem and how can it be solved?

If you actually have to ponder that, then geez....look out.

On a hunch, I would have to venture to say that, in order to stay out of debt, don't get into it in the first place.

I don't think that's all THAT difficult of a concept to come to grips with.

I read somewhere that a credit card balance of something like $10,000 would take nearly 20 (TWENTY) years to pay off at the minumum. I don't have my loan calculator program here with me, but to pay off that $10,000, it would, when all was said and done, cost you nearly $50,000.

Of course when you *have* to have that new car, you *have* to have those new clothes (only from Aerocrombie+Fitch), you *have* to go out traipsing around every Friday night (spending money), AND you're 21 years old and living in a dorm, and you only make about $600 a month as a Pizza Hut delivery driver, well, it's really a no-brainer.
 
L-188
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Joined: Wed Jul 07, 1999 11:27 am

RE: Student Credit Problems

Fri May 02, 2003 10:47 pm

Actually from what I understand, is that those "minimum payments" set you up for about a 25 year payoff period on your debts.
OBAMA-WORST PRESIDENT EVER....Even SKOORB would be better.
 
captaingomes
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Joined: Tue Feb 13, 2001 1:33 am

RE: Student Credit Problems

Fri May 02, 2003 10:51 pm

It's one of the big distinguishing factors between previous generations and the current generation. Years ago, there weren't the same facilities for people to go into debt, so they didn't. Almost everything was purchased with good old cash, from cars, clothes, and more often than today, even homes.

Arguably, this going into debt to purchase more goods leads to a higher standard of living, since we purchase more goods, the economy expands, and supposedly society is better off because of it. I tend to agree with this, but it takes a lot of discipline not to go overboard. While people complain about not having money, most people I know, even those in low income levels, must have their cell phones, with unlimited evenings and weekends, internet, cable, good clothes, new car, and the list goes on and on. Of course you could argue that they don't own anything, since their in so much debt.

If you go to many schools today, the students drive better cars than the teachers. That in itself tells you a whole lot.
"it's kind of like an Airbus, it's an engineering marvel, but there's no sense of passion" -- J. Clarkson re: Coxster
 
mika
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Joined: Thu Jul 27, 2000 7:53 am

RE: Student Credit Problems

Fri May 02, 2003 10:56 pm

I always pay as much as i possibly can on my credit card debts. This month i threw away almost $500 on them (I have 3 cards). I have no problem living a bit more over my usuall standards for a couple of months and then live cheap as hell equal amounts of months to pay the bills off.
 
Matt D
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Joined: Fri Nov 19, 1999 6:00 am

RE: Student Credit Problems

Fri May 02, 2003 11:16 pm

Well do the math people. You cannot spend more than you have indefinitely.
 
saintsman
Posts: 2037
Joined: Fri Mar 15, 2002 12:34 am

RE: Student Credit Problems

Fri May 02, 2003 11:27 pm

It isn't just students. My wife is always complaining about how much she owes, yet she will go and buy a new pair of shoes without thinking. Now if she needed shoes it wouldn't be a problem but how many women do you know that has only one or two pairs?

To all the students who are on a budget. If you don't have it don't spend it. It may seem unfair that the rest of the world is having a great time and you're not, but I can assure you that there is plenty of time left to enjoy yourself after you graduate. You will probably enjoy it more when you have a good job and can really spend. It may also seem a long way off before you graduate too. Believe me time goes by fast, especially when you get to my age! Tighten the belt, it'll be worth it.
 
fritzi
Posts: 2598
Joined: Sat Jun 30, 2001 2:34 am

RE: Student Credit Problems

Fri May 02, 2003 11:28 pm

Why do you think that I have canceled the credit account on my bank account???

One tip to all you younger ones out there. Dont get a American Express or Visa to show off with. Don´t get one until you earn your own money.


You wont have a debt if you dont have a Credit Card!
 
captaingomes
Posts: 6251
Joined: Tue Feb 13, 2001 1:33 am

RE: Student Credit Problems

Fri May 02, 2003 11:33 pm

My advice is, go get a credit card, build your credit, and learn to be responsible. I've had a VISA card for quite a while now, and I always pay the full amount every month so that I don't pay any interest. It's a good time to learn how to budget appropriately. I've always wondered how young punks making minimum wages can buy cars, cell phones, go out all the time, rice out their cars, etc etc. The true test is to see how they do 5 or 10 years down the road.
"it's kind of like an Airbus, it's an engineering marvel, but there's no sense of passion" -- J. Clarkson re: Coxster
 
jcs17
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Joined: Mon Jun 18, 2001 11:13 am

RE: Student Credit Problems

Fri May 02, 2003 11:40 pm

Students are complete dolts when it comes to using credit cards. What do you think? You dont have to pay that 10 grand back? The company will feel bad and release you from your financial obligations.. I dont think people under the age of 22 should be able to apply for credit cards without proof of a full time (year-round) job. Use a debit card!!! I only use my Chase/Continental Airlines debit card, and its about 20 times easier than worrying about running up charges on a credit card. I do have a credit card, but I only use it in emergencies, when I know that I'm in a situation where my parents would be willing to pay me back.
America's chickens are coming home to rooooost!
 
mls515
Posts: 2954
Joined: Mon Jun 26, 2000 5:56 am

RE: Student Credit Problems

Sat May 03, 2003 12:06 am




I've had a credit card since the summer after I graduated from high school. I used it regularly and eventually got a second while in college. I would occasionally bling bling around but throughout 98% of college and to this day I have ZERO credit card debt. Actually my only debt is my student loan, and that's just about like a car payment but with better interest.

I think the difference in my case is that I actually WORKED while in college so I had my own money comming in. and you only make about $600 a month as a Pizza Hut delivery driver.... I think that's a bad example, $600 a month is a lot of money to have while in college and I think that someone pulling in that kind of money could easily avoid getting in a big hole of debt. Now, their spoiled roomate who has never worked is going to be the one to hang themself in their dorm room because they have no idea how they're going to get the $25 a month together to make the minimum payment on the $5000 credit card they maxed out. And they would be too scared to go to mommy and daddy because they wouldn't be able to explain what they spent $5000 on.
 
AC320
Posts: 2809
Joined: Fri Jan 05, 2001 11:29 pm

RE: Student Credit Problems

Sat May 03, 2003 12:48 am

I've been trying to get one of those special student credit cards for months now. One interesting occasion a few weeks back I applied for one that was designed to be "your first card and help you establish your credit" as it was advertised, so I filled out the application and a few weeks later a got a note that said I was rejected due to "insufficient credit history" all that for a card with a limit of $500?! I called and ask them to explain how you can be denied for something that's supposed to be your first card for a lack of credit history but they didn't explain it.

The rest of the places won't give me one because I don't have a green card yet. I feel like a second or third class person here.
fuddle duddle
 
aloges
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Joined: Tue Jan 17, 2006 3:38 am

RE: Student Credit Problems

Sat May 03, 2003 12:55 am

As others said - the best way to avoid credit card debt is either not having one or knowing how to use it. I had one while on student exchange, the limit was 5000 Mark per month - but most often, I didn't even use one tenth of that. Back home, all I have and need is a debit card to draw cash at the machine. Buying via the internet will only work for me if the seller accepts money transfers or does direct debiting. It works pretty well, I just don't buy what I can't pay immediately.
Don't cry because it's over, smile because it happened.
 
L-188
Posts: 29874
Joined: Wed Jul 07, 1999 11:27 am

RE: Student Credit Problems

Sat May 03, 2003 4:50 pm

If you absolutely need to have a credit card. I would recommend getting a secured one.

That is what I did when I lived out in the bush. A plane ticked out of there was in the 1000 dollar range so that was the limit I got for the card but putting that much into a savings account.

I had access to the money in case it was needed but was still able to draw the interest from the savings account that it was held in.
OBAMA-WORST PRESIDENT EVER....Even SKOORB would be better.
 
KAL_LM
Posts: 492
Joined: Fri Jun 29, 2001 8:58 am

RE: Student Credit Problems

Sat May 03, 2003 7:42 pm

In a way the credit card companies are to blame. In no way am I saying that personal responsibility, or lack thereof, is not an issue, but the credit card companies try to go after students for the very reasons above. They know that young, sometimes irresponsible students want to have a good time and a credit card feels like free money, until they start calling you and leaving nasty messages when you don't pay them back.

Having made my own mistakes...and lots of them, I am slowly climbing out from them. It's not easy and the consequences can be daunting, so like many before me have said, watch what you do. It will come back to bite you in the ass. (I'll show you my interest rates to prove it...).

So like my wife and I have learned, the hard and very painful way (and others have elucidated): if you don't have it, don't spend it. Simple as that.

regards,
Tom
is that a light at the end of the tunnel or just a train?
 
SophieMaltese
Posts: 2023
Joined: Sat Feb 17, 2001 2:08 pm

RE: Student Credit Problems

Sat May 03, 2003 8:16 pm

I hate credit card debt. It's like a monster that tries to eat you alive. And they give it away so easily...at least at first. Then when you're in too deep you can't even get a car loan.
 
ybacpa
Posts: 1080
Joined: Thu Mar 01, 2001 5:39 am

RE: Student Credit Problems

Sun May 04, 2003 4:57 am

Credit cards are both the greatest thing ever invented, and the worst. The only thing that differentiates the two is the responsibility of the individual. I've had several credit cards since I graduated high school. In college I was the typical '600/mo' wage earner, but I understood that meant I could not charge more than 600 / mo on my cards unless it was absolutely necessary. That said, being responsible and paying my entire balance off each month meant, and still means, I actually save money. Admittedly, the amount has never been significant, but the $75 in free gasoline I received each year or so from using my Shell credit card meant about 4 fill-ups free.
Today, between the airline and hotel miles I earn and redeem, I figure using my credit cards and not carrying a balance saves me in the neighboorhood of $5000 - $10000 per vacation (2 business class tickets, hotels, etc).
So, while there is potential for significant damage, for those of us that behave responsibily, there is also the possibility of great reward.
SkyTeam: The alliance for third rate airlines finally getting their act together!
 
jwenting
Posts: 9973
Joined: Mon Apr 23, 2001 10:12 pm

RE: Student Credit Problems

Sun May 04, 2003 5:21 am

When I was a student I couldn't even get a credit card...
And no large overdraft on my bankaccount either (something like €250 max)...

Despite having to get by on a low income, I never got into debt except once when the automatic payment of my rent went wrong and €2000 got withdrawn instead of €200 (on a €600 a month income...).
I wish I were flying
 
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yyz717
Posts: 15689
Joined: Mon Sep 10, 2001 12:26 pm

RE: Student Credit Problems

Sun May 04, 2003 5:25 am

The credit card companies are not to blame. They are simply conducting business.

If anyone is to "blame" (other than the students themselves) it's their parents for not providing basic direction or instruction on managing budgets and credit card debt while they were teenagers.

I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
LH526
Crew
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RE: Student Credit Problems

Sun May 04, 2003 5:30 am

I'm a university student, earn good money, have two Creditcards from Barclays Bank, Visa and Mastercard and my local banks debit card and It works great! I've NEVER been in debt!! Just controll yourself!

Mario
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