National Consumers League

Congratulations, Class of 2008! Now Pay Up


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While millions of college students are frantically trying to land their first real job and secure affordable housing, many are also racking up the credit card debt.

The U.S. Department of Education estimates that almost 25 percent of college students will take on credit card debt in order to pay for their education.

Savvy grads know that having a solid credit history pays off for a bunch of reasons. Here are a few: when applying for a job, securing loans and purchasing auto or homeowners insurance.

Need a crash course in building a positive credit history?

  • Use credit responsibly. Start establishing a good credit record now. The longer and more stable your credit history, the higher your credit score. Try to pay off your credit card balance in full each month. Only keep the credit cards you need, and don’t use more than 30 percent of the credit available to you on your credit cards. Use cash instead of plastic whenever possible.
  • Set up a budget and stick to it. Figure out exactly how much money you are earning and how much you owe. Write down all of your expenses for a couple of months to get a realistic sense of what you are spending, and where you may be able to cut back.
  • Pay bills on time. Consider setting up automatic payments so you are never late. This will help to build a strong credit history. A pattern of late payments not only lowers your credit and insurance scores, but late fees and interest payments can add up and make it harder to pay down the balance.
  • Monitor your Credit Report. Check your credit reports at least once a year. If there are mistakes, get them corrected quickly.
  • Visit the Insurance Information Institute’s Web site for more tips on chipping away at your debt, and building good credit.

Do you have any tips for recent grads? Share them here!