College education is very costly and students leading a campus life have many extra expenses. There are different projects to complete, several extra curricular activities to attend and a host of other things which need finance. Many students are just making ends meet, and any extra source of finance is always welcome. Many credit card companies have sensed this opportunity and are advertising in a huge way to make students apply for their credit cards. They give tantalizing offers with initial low interest and also free gifts like T-shirts and so on. Although a credit card has many advantages for a student, if not properly handled it can cause a huge credit card student debt.
According to recent statistics almost 83% of college students who are undergraduates have credit cards, and also the students owned an average of 4 credit cards each. The average credit card student debt was calculated to be more than $2000 and about 40% of these students had a debt of more than $3000. These are alarming figures and it shows that many students are not able to handle their expenses in a proper way and their credit card student debt steadily increases as they progress to the higher classes in college.
A credit card student debt can become a serious problem, especially when it is coupled with other loans that the student has taken for college education. The minimum balance of a credit card student debt has to be paid off every thirty days. Also if the student keeps spending this minimum balance will keep increasing and so will the interest. The situation can spiral out of control if the student is not careful about his spending.
Credit card student debt is manageable if from the beginning the student keeps his focus to curb overspending and keeps in mind certain important points. The student should prioritize all his expenses and only spend on the items which are necessary. It is also important to draw out a rough budget figure so that you will at once know when you have reached your limit. Also the student can allocate only certain expenses to a credit card.
When a credit card student debt is not paid in time the student is penalised by way of late payment fees and also there is a strong likelihood of his interest rates going up.