Credit Card Articles

     Read this Excerpt from Dara Duguay's Book, Please Send Money

Read More Articles:

Consequences of Credit: Part I
It all started with a single credit card. Then things got out of control.

Consequences of Credit: Part 2
The job market is bouncing back but students with credit problems may find that some companies are not willing to hire them.

Consequences of Credit: Part 3
A credit expert shares a few tips, tools and techniques to support young adults in saving more, spending less, paying off their debt and becoming financially savvy.

Ask YOUNG MONEY: How can I build good credit?
A college student gets advice on how to build a healthy credit report. 

Ask YOUNG MONEY: Can you build good credit with a low spending limit?
A financial expert dispels some myths about what helps improve a credit score and build credit history.

Develop a Credit History During College
There is a middle ground in which students can build a credit history in college, have the convenience of using credit instead of cash for purchases and emergencies, and still not run up a lot of debt.

Credit Card Crisis
Students must use good money management to avoid piling up credit card debt

Ask YOUNG MONEY: Should I pay off my credit card balance each month? A reader asks whether paying off your credit card bills monthly really help one’s credit history.

Why a Credit Card is Useful for Students  Despite statistics that the average student leaves college with lots of debt, there is a good reason to have a card: to establish a credit history. 

See a podcast interview with Dr. Manning of about college students and credit cards.(Quicktime movie.) 

Credit Cards Teaching Students a Costly Lesson

Easy Credit Can Mean Long-term Hardship for College Students
USA Today article discusses problems college students may face.

Avoiding the Pifalls of Your First Credit Card

Ask How to Avoid Credit Pitfalls?

Who links to my website?

From “Please Send Money” by Dara Duguay, Chapter 5 The Semester of Living Dangerously, pp. 73-74

The Freshman Ten

Reprinted with permission by the author.

“Although the “freshmen ten” has usually referred to the extra ten pounds the average college freshman gains during their first year, it also can refer to debt. In the case of Christi, the “freshman ten" referred to the extra $10,000 she charged on credit cards her first year in college.

“Credit card companies eagerly seek your business. College students are targeted for many reasons; it is cheaper to conduct mass marketing campaigns on college campuses (about one-half the cost of marketing elsewhere) and their present and future needs include a wide-range of financial services (private student loans, debt consolidation loans, checking accounts, savings accounts, auto loans, and home mortgages). Finally, unlike other nearly saturated credit card “niche” markets, at least one-third of the population of four-year colleges and universities are replenished each year with new students (freshman and transfers). These factors inspired Citibank to spend $10 million in 1999 just marketing credit cards to high school and college students.

“The reality is that the United States is a free market society, and when someone is of a legal age, they can be pursued as a customer and help responsible for their debts. This means that as a college student, you will continue to be sought after by credit card companies and other financial institutions. Remember that just because you are offered a credit card doesn’t mean that you have to accept it.

“Christi’s problems all started as a freshman when she found a credit card application that had been placed in her bag at Florida State University’s bookstores. She did not have a credit card and thought it would be smart to have one for emergencies She was far from home, having been born and raised in Illinois, and she felt safer having a credit card in her possession. Unfortunately, Christi’s definition of emergency included meals out, new CDs, and football tickets. She enjoyed going out with her friends, which soon became a daily occurrence.

“When she reached the limit on her first credit card she easily obtained another alication from a credit card compnay’s booth outside the student union. Christi even got a water bottle for filling out the application. When this card also became charged to the max, Christi went back to the student union and this time got a T-shirt along with her third credit card.

“Before it even seemed possible, Christi had accumulated $10,000 on her three credit cards. She never kept track of her spending, so it was easy to get her debt level up this high. So far she had been able to handle the minimum payments by working her part-time waitress job, but now these payments were more than she could handle.. She responded by increasing her hours at the restaurant, which left less time to devote to her schoolwork.

“By the time summer break arrived, Christi returned home with poor grades and a large debt. She advised her credit card companies of her new address in order to receive her bills over the summer. Her spending habits would have remained a secret it if hadn’t been for her brother. He saw a credit card bill arrive one day for Christi and promptly opened it. He wasted no time in telling Christi’s parents about the amount of money that she owed.

“Her mother and father were livid. They were extremely disappointed and Christi had to endure numerous lectures on her poor money management. But in the end, they paid of her credit cards since they didn’t want Christi’s credit affected negatively. By the time Christi returned to college in the fall, they had her sincere promise to not apply for any more credit cards. If she did, her parents said she would be on her own to pay them off.

“Christi might argue her story had a “happy ending.” Her parents paid off her debt and her problem went away. Typically though, when the debtor has someone else pay off their debt, they never learn the lesson. Therefore, the behavior that got them into debt in the first place will probably be repeated. Christi could easily continue her same old spending habits and believe that despite her parents’ warning, they would bail her out again if she gets into trouble. By relying on her parents to be her financial guardians, Christi could have a difficult time becoming financially independent.

“A much happier ending would have been for Christi to have taken a loan form her parents and remain accountable for her debt. She could have paid them back interest free at a payment schedule she could handle. This lingering debt would have served as a reminder of what can happen when credit is not used wisely. Hopefully Christi would then have learned a valuable lesson.

“Remember these simple rules regarding credit usage:

  • One or two (at the most) major credit cards is all you need to build a credit history.
  • Set your own credit line/limit. Recommendation - $500 and not more than $1,000.
  • Pay your bills on time.
  • You can build a credit history without carrying an unpaid balance.
  • If you must carry a balance, always pay as much as you can afford each month and try to pay it off within three months.”

Also from Dara Duguay

"About 40% of young adults who leave their parent's home return at least once. This boomerang effect is becoming common. In a number of instances, many "return to the nest" for financial reasons. "

Reprinted with Permission.


“If you can eat it, drink it or wear it, it's not an emergency.”

Recommended Book

Please Send Money! A Financial Survival Guide for Young Adults On Their Own by Dara Duguay