Building Your Portfolio

BUILD YOUR

EXPERIENCE 1 2 3 4

4 BUILDING YOUR
PORTFOLIO

Credit Cards: A Slippery Slope Do you remember the saying “There is no free lunch”? That is a good maxim to keep in mind as you consider adding credit cards to your financial picture. College students are often targeted by credit card companies through an offer of a free T-shirt or other novelty if they sign up for a new card. Although it might seem harmless at the time, signing up for multiple credit cards can have you in financial trouble, and fast!

A big factor in effectively managing your credit card debt is being aware of the terms and conditions that apply to each account you have.

  1. If you already have credit cards, find your most recent billing statement. If you do not have a credit card, do an Internet search for “college student credit cards.” Choose one of the Internet offers, and find the terms and conditions and do the exercise in #2 as practice for when you do get a credit card.
  2. Next, to understand the fees associated with a credit account, create a spreadsheet with the following headers (see an example here):
    • Card Issuer and Card Type
    • Credit Limit
    • APR (Annual Percentage Rate)
    • Default APR (A default APR may be used when you fail to make the minimum payment on your credit card account or exceed your credit limit by a certain amount. The default APR is always higher than the stated APR for the credit account.)
    • Due On
    • Late Fee
    • Over Credit Limit Fee
  3. List each credit card you have, and enter the associated fees.
  4. Save the file and refer to it regularly.
  5. Update the file any time you open or close a credit account.