Student Loans: Five big mistakes that students make with credit cards.

Credit cards and students don't always mix well, mostly because easy money is too soon spent

But if students avoid these mistakes then they will have an enjoyable experience with money. This applies to any first time credit card user, but students are can also be away from home and that puts them at greater risk.
The Five biggest mistakes students make with credit cards are:

1. Getting a credit card without understanding the terms.

Credit cards are a financial contract. "I'll do this for this much, if you do pay me this much."
Contracts also carry consequences.
Do you know what those consequences are using your credit card, and who might be affected, besides yourself?
For instance, do you:

• Know the interest rate on your credit card
• How that interest rate is calculated
• What penalties apply if you breach the terms of the contract?
• What those breaches will cost you in money
• What those breaches will cost in your parents credit score if they are guarantor
• What those breaches will cost your future credit?

If your parents guarantee the loan what will happen to their credit and repayment costs if you default?Do you know all the ways you can default on a credit card loan?

2. Buying things you don't need because you have a credit card

Its so easy to buy with a credit card. The money isn't real and its painless. Everybody's doing it right.
Retailers love credit cards because they know people, especially students will spend more because they have a credit card.
Here's a few credit card tips:

• Always know your monthly budget
• Never buy what you know you can't afford to pay off in advance.
• Never go to sales, just because you might find a bargain. Target purchases in sales that you know you need.
• Never buy lunch with a credit card. Get cash out and then buy.

Remember the average student carries over $3,000 in credit card debt. Do you know how much that means in payments you have to make every month, just to cover the minimum repayments.

3. Make do with just one credit card

The average student carries 4 credit cards. That's four ways to get into debt. Four service and monthly fees.

Remember if you fail to meet the minimum requirements on your credit cards your credit score will tank and then all the interest rates could increase.

4. Keep track of credit card purchases

It easy to have $100 in your wallet and then wonder where it went by the next day.
Well a credit card is like having that $100 constantly replaced with fresh ones. You need to keep count and keep track. Otherwise you will soon max out your credit and card.

5. Pay less credit card interest

Choose the card with the least amount of interest payable. Know the terms of the contract and ensure you don't breach them.

• You will always have to pay back the credit card debt 
• Plus interest 
• Plus service fees and charges 
• Plus credit card baggage if you mess up. 

When you mess up your credit scores, every credit reporting agency gets to know about it. There is no where to hide. You need to know this before you use that credit card the first time, not when you have a mountain of debt and no way to repay it.

If you buy something for $500 and it ultimately costs over a $1,000 in interest repayments, added fees and charges and penalty fees and interest, and extra interest rates because you have destroyed your credit, was that $500 purchase the bargain you thought it was?

Credit cards make it easy to get what you need to complete your studies.
It also makes it easy to get whatever you want. Know the difference.
Source: Mr Mortgage

Credit Cards: No interest rate credit cards on the Rise. Where's the catch?

Credit card interest rates are rising relative to the RBA cash rate here in Australia, if you haven't noticed, but you can win with interest free credit cards in the US. So where's the catch you might ask?       

US consumers are using credit cards less.

Keeping their debt levels lower when it comes to credit cards is the current focus for Americans nationwide since the recession. Many credit card issuers have evidently noticed this trend, as they are offering no-interest cards at an increasing rate. But those deals have a catch, as you would expect.

No interest credit card offers

Nearly half of all major credit card issuers throughout the U.S. offering no-interest credit cards, the latter half of the year appears to be an opportune period for many consumers to jump on offers.

No fees on credit cards for the first year deals

In addition to the considerable number of credit card companies offering zero interest, Waters noted many are also offering no fees for the first year of having the cards, as well as extended teaser rates.

Your Credit score, and credit history are important to qualify for a no interest rate credit card. Going in and during the credit card use

Many banks and card companies are gearing a number of their credit card offers toward the high-credit-score demographic, who are the consumers who can mostly qualify for no-interest cards.

If you have recently improved their credit standings may find you qualify for the zero-interest cards on offer.

So. What's the catch with interest free credit cards?

Well, you would think that not defaulting will keep your credit scores high.
That can be a mistake, because no-interest rate credit cards, have clauses that say that if your credit score falls during the introductory period you get hit with interest charges of between 10 and 25 percent.

Keeping your credit score high is essential to keeping a no interest rate credit card active. And the credit card companies are betting on you falling off the wagon.
The catch in no interest rate credit card deals is in the fine print.

Source: Mr Mortgage