(DegreeAdvisers.com) – College life. While it may be slightly different than it was a year ago, before the pandemic, there are still costs that can accumulate expeditiously. Extending an old card or opening up a new one might seem like a good option, but credit card debt can be a real problem, especially when compounded by student loans. Here are a few tips on avoiding credit card debt in college.
Create a Cash-Only Budget
No matter how much money you have each month to work with, you need to designate where every penny goes. If you’re having trouble sticking to a budget, switch to using cash for all your purchases. This may seem strict, but it can help you avoid debt.
After paying all your bills electronically and putting some into savings, take what’s left and create an envelope system. Create one each for groceries, gas, eating out. Only use the amount in each envelope per expense. Be diligent about it. This practice prevents overspending and the urge to use a credit card frequently.
Get a Part-Time Job
You work hard, and there isn’t a lot of free time at the end of the day. There isn’t a ton of money either. You can’t keep racking up your credit card balances. The over-the-limit and late fees can really hurt your pocketbook and credit score.
Try looking for a job that’s flexible. Most college towns will accommodate students’ busy schedules. Another option is an online side job or gig. Grocery delivery and drivers are good choices. Want to stay home? Platforms like Fiverr make it easy to find a position in your niche.
Don’t Get Multiple Cards
Avoiding credit card debt starts with paying off existing cards one by one. Having multiple cards makes it more convenient to spend freely. It can also make it harder to budget your finances, especially if cash flow is an issue.
Stick to one card and try to pay the balance off each month if possible. This helps show credit responsibility and keeps your credit score in check.
Avoid Cash Advances
When money runs out, some students go to the ATM and take cash advances off their credit cards. This should be a huge no. It expends your line of credit, and the fees add to the balance of the loan. Try to avoid cash advances if at all possible. Instead, ask to borrow money from family or take on a side hustle for quick cash.
Let’s face it, juggling college life can be a struggle. It’s not cheap, and many students carry a hefty debt load with expenses that keep accumulating. While it may be a challenge to remain debt free throughout college, it is possible. Being responsible with credit cards is a good starting point. Working on paying in cash and chiseling away at high credit card balances paves the path to a bright financial future. Avoid beginning your post-college career saddled with debt. You deserve the best start!
~Here’s to Your Success!
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