The modern era demands the use of credit as part of the development of a viable financial platform on which to build a life. However, as many Michigan residents are keenly aware, credit card debt is a potential pitfall that comes with the territory, and it is particularly dangerous to students who do not fully understand the implications of such debt. Therefore experts warn that students should become educated about the responsibility involved in using credit before signing up for a contract.
By the time students reach the age of graduation, over 90 percent are carrying at least one credit card. While establishing good credit is a positive step forward for any student hoping to be financially stable upon graduation, this is a journey that should not be undertaken without foreknowledge of how to do so responsibly. Credit card companies are eager to bring students into the fold because they expect students to spend irresponsibly, which is sadly often the case.
If a student does not pay a minimum payment on time, credit card companies are quick to increase interest rates in order to generate more revenue from the existing debt. Students who wish to use credit cards should learn effective spending habits prior to opening an account. It may also benefit students to "read the fine print" and understand exactly what is expected of them in their contract before signing on the proverbial dotted line.
Credit card debt can be potentially damaging both to a credit report and to a financial future. Michigan students are urged to become educated on how to manage debt effectively and seek out alternative solutions. The potential for debt restructuring or bankruptcy can help to alleviate financial stresses prior to the student entering the day-to-day workforce.
Source: indianapolisrecorder.com, Credit card debt and the college student an unhealthy cocktail, Jesse Brown, Sept. 5, 2013