Credit card debt is one of the leading reasons for bankruptcy in the United States, and often these high balances that consumers cannot escape start in college. Before your college student heads off to school, you should teach them how to use their credit responsibly. This is especially true these days, since banks will set up shop and offer freebies to entice college students to sign up for a card on campus.
Get One and Done
In general, having too many credit cards is bad for your credit. While missing payments or defaulting on your obligations is the worst, too many cards can still harm your college student’s credit – especially if they start running up a balance on multiple cards. Tell them to get one card and leave it at that; there is no need for more.
Don’t Use the Entire Credit Available
Your college student may have a low credit limit, but that doesn’t mean they should run it up or max it out. When your credit utilization is too high, it can permanently damage your credit. So, teach your student about how much to use their cards and that they should use the cards for emergencies only.
Make Your Child an Authorized User Instead
Instead of having your student get his or her own card, allow him or her to practice by being authorized users on your family credit card accounts. That way you can monitor and teach the proper use of cards to avoid debt.
Get a Secured Card
Consider having your college student use a secured card so that they can build credit history without getting too high of a credit limit. Because these require deposited funds, your college student may take using the card more seriously, since they had to fork over the money first to get the credit.
Speak with a Bankruptcy Attorney
Sometimes college students fall in too deep, especially with the rising cost of college, food, and living expenses. If your college student cannot pay off their debts or their creditors are now coming after you to pay their outstanding bills, speak with a Florida bankruptcy attorney today.
The team at the Law Office of Kelley & Fulton can help your student get back on their feet. While filing for bankruptcy may not be ideal, a young student has a better time recovering their credit if they fix their issues now than wait until they are older and want to buy a home.
Meet with us today for a consultation and let our attorneys help your college student regain their credit.
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