Credit card debt kills financial future

For many, the process of buying a new car or apartment can be a difficult time because the person’s credit history is less than stellar. The problem heightens for college students and especially for college graduates as credit card companies flood e-mails and mailboxes.

They are faced with credit card applications as well as phone calls with “great” benefits when signing up for their respective credit cards.

However, all the glitter that comes along with owning a credit card is not gold because it can create nothing but headaches and future financial problems.

To help avoid such events, the American Credit Association created National Credit Education Week. This is an annual public service campaign consisting of events and seminars. It helps educate the public on the basics of personal finance, the dangers of credit cards and how to better your credit history.

Saturday ends this year’s week that is celebrated from April 18-23. Unfortunately, no events were held here at FAMU. However, that does not mean that students should not take the time to learn about improving their credit.

With plenty of companies and Web sites available to offer free credit advice, no one should have poor credit. However, this is not usually the case. Credit card companies target college students because they are just turning 18 and are eligible to apply for credit cards. This ultimately is a trap because the rates are not reasonable and students rarely have steady income to compensate for the large bills created in shopping malls.

To avoid such mishaps, students should try taking a finance course to better inform themselves about credit cards. Another option students can employ is to request their credit report. Credit reports are detailed records of all credit activities. They detail how many credit card accounts you have, whether you are paying your monthly payments on time and how many loans you have taken.

This information is used not only when buying large items, but also when applying for jobs that have a financial background check. Therefore, you should make sure there are no errors on the report because a lot of negativity could prevent you from applying for a loan, buying a house or even applying for a checking account.

As college students, the desire for credit cards is not really a need. For many, it is an unnecessary want. The freedom of being away at college and having access to your bank account is very enticing.

For example, when I turned 18, department stores kept asking if I wanted to apply for their credit card and receive an additional 15 percent off my purchase. I did not think twice about saying yes.

In hindsight, my actions were not the best route to follow. I was satisfying a temporary craving for clothes while jeopardizing a future goal of owning a house or car.

By no means am I saying that students should not apply for a credit card. Instead, students should get a credit card to be used only for emergencies. An emergency is not a spring break trip to Cancun or not having something to wear to this weekend’s party. An emergency is a flight home for a family illness or something traumatic like that.

Sound financial management does require hard work and a strong commitment. When done correctly, credit can build financial health, a successful future and peace of mind.

Dominique Drake is a third-year professional MBA student from Cleveland. She can be reached at