The 10 Worst Credit Card Mistakes College Students Make

January 8, 2007

Blueprint for Financial Prosperity had an article the other day about college students establishing credit by signing up for one of his favorite student cards. I’m glad I had a credit card in college, it helped me build up my credit score. However, in my time at school I saw many mistakes being made with credit cards, here are 10 of the worst in no particular order:

1) Opening a Credit Card for Free Stuff
Whether it’s on the beach over spring break or in the student lounge, booths giving away a free a hat or T-shirt in return for opening a credit card are bad news. Even if you never use the card it shows up on your credit report. After opening several cards for a few freebies your credit score probably won’t look so pretty.

2) Open Door Policy
The dorms were a great place to hang out when I was in school, you could drift in and out of rooms down the hall just shooting the breeze, playing video games, or watching Sports Center. Most people left their doors open and if they didn’t you knew their lock combinations. There usually wasn’t much of value in a college student’s room, except credit cards that is. There were several instances where someone’s credit card was “borrowed” for a spending spree or used to pay for adult phone conversations.

3) Speculating on Credit
I have to admit, I love playing poker. Unfortunately the recent proliferation of online gambling sites has made it way too easy to blow tons of money playing online. When you have an hour to kill between classes, it’s tempting to sit in the library computer lab and test your fortunes. What’s worse than losing all your money in poker? Losing money borrowed at over 15% interest!

4) Taking the Card out for Night on the Town
Friday night was a great time in college. The weekend was full of potential as you hit the town with a date or a group of friends. Unfortunately, the money often ran out long before you were ready for the good times to end. If you had the credit card along, you could always rely on it to keep the party going. Just remember, the only thing worse than a hangover is a credit card hangover!

5) Carrying a Balance
I have friends in their 30’s still paying off student loans with pretty low interest rates. With today’s credit card rates of at least 15%, if you carry a credit card balance as a student you will be paying off those debts for a loooong time.

6) Opening Store Credit Cards for Discounts
It seems every time you buy something at Best Buy, the Gap, or any other retailer they always ask if you’d like to save X% today by opening a store card. When you’re a broke college student the idea of saving money sounds great! However, if you open a card at every store you shop at it will hurt your credit score. Plus if you have all those cards, you’re probably more likely to spend more money.

7) Overspending, then Reporting Your Card Stolen
I knew of several cases in college where someone charged hundreds of dollars they didn’t have over Spring Break, then called up the credit card company claiming their card had been stolen and that the charges weren’t theirs. Not much to say about this one other than it’s breaking the law and don’t do it.

8) Buying an Engagement Ring
It’s senior year and you’ve found “the one”. The only problem is she wants a big rock and you’re a poor college student with no money. Of course you love her and want to make her happy, and you don’t want to hear comments about how small the diamond is for the next 20 years. Many people turn to credit cards happily offered by Zales, Helzberg, or whatever the store may be.

My question for you, do you really want to start your marriage off with thousands of dollars of debt just for a piece of compressed carbon? I know, I know that argument probably won’t fly with the Missus. If you don’t have the money for the ring she wants be creative. Find a way to talk her into downsizing, borrow from your parents, or do something other than going into debt for diamonds!

9) Paying For Friends
The great thing about college life is the people you go through it with. Countless midnight pizza runs, poker late into the night, and road trips all build memories that last a lifetime. When you’re headed out for one of these adventures you don’t want anyone to be left behind because they don’t have the cash. It’s so easy to say, “I’ll put it on my card” or “the next round’s on me”. I’m not saying don’t help out your friends. Just make sure you have the money to pay the bill and that you’re not doing it all the time.

10) Forgetting to Pay the Bill
College is full of classes, sports, homework, parties, dating, and just learning to be on your own for the first time. Who has time to remember to pay the credit card bill? Plus if your dorm room is as messy as mine was you probably couldn’t find it even if you remembered! The unfortunate part is that missing your payment will not only cost you a $30 late fee you don’t have the money for but even worse it will put a mark on your credit history that will follow you around for years once you’re out of college.

Credit Card Cum Laude
If you can avoid making these mistakes you should graudate not only with a college degree but a good credit report and lots more money in your pocket!


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Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn't like the other kids... His addiction to personal finance has paid off for his family and now he's helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.

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21 Responses to The 10 Worst Credit Card Mistakes College Students Make

  • Charles

    student credit card holders should be responsible enough in managing their accounts. They should learn on how and when to use their credit cards and as much as possible they should prioritize important things to avoid big amount of credit which they couldn’t afford to pay.

  • Prashant

    Agreed that avoiding these mistakes in necessary but running away from Credit-card is also not a solution. Students will need a good credit score as they move on with life (like buying a house).

  • Jon Dickens

    With the current credit crunch, obtaining approval for unsecured personal loans is difficult. However, there are still networks of lenders providing personal loans to people of every credit type.

  • rv

    thank you, good update your list with some of the additional useful comments from readers…

  • Pit

    Huh! Great!
    I’ll tell my friens about your post!

  • Shiela

    When you’re dealing with credit cards, you’re playing with fire. Unfortunately, there are plenty of people out there who don’t realize that, and make all sorts of dangerous mistakes with their credit cards every day. Or they will end up having bad credit score.

    Bad credits have become nothing but normal nowadays.

    They could still get house loans,cards and mortgages,because there are lenders offering bad credit credit cards.

    People with poor credit score can easily get credit cards for bad credit and get a chance to rebuild their credit standings at the same time.

  • bad credit credit cards

    mistake 10 is especially important to look out for, you don’t want to get out of college with a bad credit rating, especially since you should be applying for a mortgage soon.

  • Kotisska

    I agree with all the statements of the article, but it’s also wprth saying that some really reliable credit companies offer credit education for the young together promoting their credit cards for students. So it’s not so bad with everything!

  • good credit builder

    Good day! It is the actual topic. I think the best time to start building credit history is student days. I have been starting when I was a student. The most important fact-not to accumulate debts and use credit card wisely. And ask your parents to help you, if in some cases, you are not able to pay.

  • ispf

    This is a great article! I personally made some of these mistakes at first, but after a while realised the value of good credit and now am on good track, credit wise. Just wanted to let you know that I have linked to it. Thanks.

    […]Money Smart Life has an excellent article titled The 10 Worst Credit Card Mistakes College Students Make . It’s a great post and must-read for all students with credit cards. […]

  • ispf

    This is a great article! I personally made some of these mistakes at first, but after a while realised the value of good credit and now am on good track, credit wise. Just wanted to know, I have linked to it. Thanks.

    […]Money Smart Life has an excellent article titled The 10 Worst Credit Card Mistakes College Students Make . It’s a great post and must-read for all students with credit cards. […]

  • Posh Keeves

    Great info. Student credit cards can help both high school and college students build up their credit history.It is important that they work with student credit card companies specifically designed for the student’s mind. Also these student credit cards should aid in teaching them “financial responsibility”. Have a Super day!


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