Personal Business Journal

If you’re a college student, chances are you’ve been offered more than a few credit cards. Maybe you have a friend who has already run up credit card bills on par with her student debt, and so you’ve steered clear of the credit card offers. Or maybe you’re one of the few who have received their first credit cards and used them responsibly – so far, at least. Regardless, you probably don’t realize just how important responsible use of your first credit card is to your financial future. It could have a significant impact on whether or not you’ll be able to get financing for your first new car or house, and increasingly, it could even determine whether or not you get hired for your first professional job.

If you’re not a college student, be sure to forward this message to anyone you know who is — it’s that important.

The Importance of Building Credit History

For many people, credit is a Catch-22: They can’t get approved for credit because they don’t have a credit history, but they can’t build a credit history without first being approved for credit. Luckily for them, college students don’t tend to have this problem. Credit card companies view them as low risk, at least compared to other young people with no credit, and so they’re willing to give them a first chance. As a new cardholder, it’s vitally important that you make good use of this first chance.

When you have a credit card, the issuing company reports information to each of the three major credit bureaus – Experian, Equifax, and Transunion. This information  includes the amount of credit you’ve been approved for, how much of that credit you are currently using, and most importantly, your payment history. All payments – both late and timely – show up on your credit report, and even one late payment can hurt you rather badly when you lack a solid credit history. This is why you should always, no matter what, pay at least the minimum due on each of your credit card bills. Always Try To Pay More Than The Minimum Due

While it’s important to always pay at least the minimum due, you should never only pay this amount unless you are completely unable to pay more. In fact, it may not be a bad idea to pay the minimum immediately upon receiving your bill and then pay more later in the month when you have more money.

If you pay less than the total amount due, you will be charged interest on your next bill. Even though the credit card company holds you in higher esteem than one of your high school peers who didn’t go on to college, they still regard you as a rather risky proposition – which means you’ll probably be paying a very high interest rate. If you only pay the minimum due on a card with a high interest rate, it could take you several years to pay off even a modest amount of debt.

Take Advantage of Your Opportunities – But Use Your Credit Wisely

Believe it or not, it may be easier to get approved for credit while you’re in college then after you get out – particularly if you don’t start a professional job right away (or at all). The high interest rates you’re asked to pay are just part of being a newcomer to the world of adult finance. But then again, if you always pay your credit card bills in full, interest rates will be irrelevant.

It was not very long ago that when a couple were married their finances became merged and everything was as one. Today, many people are opting to keep things separated for a variety of valid reasons. Because of the way society has unfolded, our finances have become extremely complicated with a large amount of debts, child support, and loans that they may have gotten prior to marriage. It really depends on the situation of the couple as to rather a separate checking account will work or not.

The first thing that needs to be done is that both of you will need to sit at the table and discuss all options that are available to you, be honest and open about your financial wellbeing and make an informed and mutual decision. Traditionally, couples open a checking account of the joint type, this is best way of merging finances together on both sides. However, it is important that both parties be responsible for the comings and goings into that joint account. This will require consistent communication, saving receipts, and updating the register constantly, this will provide the other person with knowledge of what has been happening. This may not be the best option for those who have troubles with keeping receipts or keeping track of checks written.

Another option that may be available to couples is having two separate accounts and one joint. There are a variety of excellent aspects of this scenario, you make an agreement about the amount that each person should place into the joint account each week, bi-weekly, or monthly and this should go towards household expenses. This allows each side to keep their own account, have their own financial freedom, and yet still be contributing to the rest of the household needs. You will both need to sit down and discuss how much should be placed into the joint account, to do this first begin by creating a budget that specifically outlines all of the household expenses on a monthly basis. If each of you earn pretty close to the same amount of money each month, you both should put half in each month.

This should include a savings account for saving for any type of goals you have such as children education, vacations, or other types of financial goals. With the separate account, these should be used to pay off all pre-existing debts you may have from prior to the marriage.