ChickSpeak

This is how it starts. Credit card companies are sending you applications for limitless credit every day.

You got to any store and as soon as you make your purchase the sales person will ask you “Would you like to save 10% today on your purchase by opening up a store credit card?” And you can’t even count the number of emails that flood your in box daily promising you free gifts, and card made of everything from gold to platinum. You are so tempted. Who wouldn’t be?

Why say no to something so easy, especially when you have bills, car problems, clothes to buy, girls dinners to attend and a new guy in your life to spoil. But here is some information that you may not be getting. 

Once you sign up it is easier that you think to spend, spend, spend. The part that no one ever tells you is that there are hidden fees, accumulated interest on every purchase you make and that you really do have to pay back every penny.

The next time you get an offer you can’t refuse, take a deep breath and remember this advice.

Don’t do it, yet. Avoid the lure, the temptation, the free gifts. All of it. Don’t sign up until you feel you are fully ready and responsible to handle a credit card. Do you have a steady stream of income? Are you committed to pay off your balance every month? Think of it this way. If you don’t pay off the $550 Jimmy Choos at the end of the month the interest on them will start to accumulate and before you know it they will cost you double what you first paid. What’s more by the time you do pay them off you won’t even be interested in wearing them anymore.

If you do want the convenience of not always carrying cash, go to your bank or credit union and request a debit card. This type of card is connected to your bank account. As you make your purchases the money immediately is withdrawn from your account. This is a great way to track your spending and see if you are an impulsive spender.

Educate yourself. Learn more about credit and finances. The more you know the better off you will be. There are credit cards that offer cash back on all the spending you do in a year. There are other credit cards that give you bonus points or airline miles. And some credit cards insist that you pay off your entire balance at the end of each year. When you are ready, you will be fully armed with the information you need and will be able to pick out the card that will work best for you.

Seek out advice and heed it. Listen to your friends. They might have a wallet full of credit cards and it may seem like they are handling their finances just fine. But are they paying the balance on them? Or are their parents responsible? Have an honest talk with your own parents, a mentor or someone whose financial savvy you really trust and ask them about their experience with credit. See if you can learn from their lessons and mistakes.