Credit Cards for Students – Can Banks Really Help?
Before entering professional life with loads of responsibilities, people think of university life as the last phase of fun and adventure. These four years come with great pleasure of studying and enjoying at the same time. For many people, it can either be a nerdy phase when they are book worms, for others it can be hanging out with friends and shopping every weekend. However, it has to be the one mentioned in the beginning, i.e. the perfect blend of the two sides of the picture.
Spending Ends in Paying
Of course, being a student is costly business, and your expenses in this duration are indeed considerable. For this purpose, banks are always at students’ service with credit cards featured specifically for them. While that may sound a bit too exciting for a freshman, it actually comes with responsibility. What some students miss out on is the fact that all that they spend has to be paid back one day to the lender, i.e. the bank. That’s where problems start arising.
Conditions to Qualify
There are many conditions to fulfill before you can qualify for a student credit card in Australia. At times it may get a bit too annoying, but that’s how banks work. A few conditions to qualify are below:
- You must be 18 years of age or older
- You must be an Australian citizen
- You must be enrolled as a full-time student in a reputable and recognized educational institute
- You must be at least in the second year of study
- You may need a co-signer (parent or guardian), who can take the responsibility of paying your debts incase you can’t
- You may be asked to open a savings account in the bank
Know Your Budget
Students are usually tempted by the idea of having a credit card so that they do not have to suppress their wishes. It is imperative to understand the difference between needs and wants. You spend heavily and get under the burden of debt you can’t repay. In order to avoid such circumstances, it is necessary to have a budget with you. If you know how much you can afford to spend each week, it will really help you stay within your limits.
Uneasy Present and Endangered Future
Even bigger problems arise when you delay your credit card payments. Usually student credit cards have higher interest rates than others, and thus missing out several payments can lead to huge debt in your name even before you complete your professional education. Not only does it affect your academic performance, it also endangers your chances of employment as many employers now run credit checks. Therefore, a student credit card should not be considered as a key to freedom, but as risky business.