“There are so many shops around campus. It’s all a big trap for students to spend money,” said Alex Wan, a New York University junior who has been dependent on his Visa card since the age of 17. He is still working to pay off his $1,000 debt from buying clothes and other electronic gadgets from the Internet.

Credit card companies also target college students because they believe that the parents who can provide a college education can also run to the rescue if the student’s credit situation comes to desperate terms.

“It’s not just about independence and face, but parents are always looking for a way to teach their kids,” said Edward Yeung, a Canadian University student who’s taking time off in New York City.

Most parents should be afraid to know that most college students don’t even know what APR means.

Annual Percentage Rate: The interest that is calculated every month depending on the amount spent. Most credit card companies like to entice students with their “zero percent APR” offer for the first six months.

Laying the trap. Of course, the zero percent APR isn’t the only attraction that companies such as MasterCard and Visa use in their tactics to lure innocent young graduates entering the world of independence. Oddly enough, new students are attracted to the free T-shirts and hats offered with a credit contract.

Students who intend to use their credit cards only for emergencies usually find it all too easy to use the cards for impulse shopping. The Consumer Federation of America has found that although there are affluent families that usually pay off debts and then impose financial rules upon the student, there are also students who are forced to drop out of college to work off the debt, and there have even been cases of suicides.

The statistics are startling. The average credit card debt per student in 2001 was $2,237, an increase of 43 percent since 2000. In the same year, there has been a 78 percent increase of undergraduates holding credit cards. Eighty-three percent of undergraduate students attending four-year institutions have at least one credit card. Although credit cards are good ways to build credit for the future and are a useful during emergencies, numbers say that students are using them for far more.

          Credit cards don’t allow customers to spread the amount they owe over a set period of time, unlike traditional loans. Minimum payments are received monthly and are usually two percent of the overall balance. However, what many college students fail to understand is that by paying only the minimum amount each month instead of paying the entire balance, their debt will continue grow significantly.

As bad as I hate to see it, nowadays there are, can I say, some advantages to having a credit card? Try buying something over the internet with cold hard cash. It is a hard deal to make. It is also more secure than cash. If you loose your card you report it. But loosing your cash, you will probably never recover your loss.

 Credit cards have been accepted as efficient payment solutions that serve as an alternative option to actual cash. Here are the reasons why.

 

If you don’t get paid regularly you may have trouble paying for items when you need them. With a credit card you can make the purchase now, and pay for it later. Or during tough times, you can make the necessary purchases you need today, and pay once you get back on your feet.

Another very important and often overlooked good aspect of credit cards is the security of the credit card. It’s not smart for anyone to carry around large amounts of cash for any reason. You could get robbed and there goes your cash. With a credit card, you can leave your cash in the safe hands of your bank. Along those same lines, using your credit card for purchases is safer than using cash because you’re purchase is documented, and most credit card issuers will allow you to dispute any purchases with the merchant if any problems arise. If you pay cash, you’re on your own. And there’s often no itemized bill to go with it.

Depending on your card, the rewards can vary, but the good news is that there is such a wide variety of options that you are bound to be able to find the right card to fit your lifestyle if you shop around. There are cards that offer plane tickets, sports merchandise, and good old-fashioned cold hard cash for every time you use your card. Others build up a stockpile of points for cardholders to use to get whatever their little hearts desire or can dream up. Points may be used to purchase DVD’s, CD’s and other merchandise.

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