I would like to begin by tell you about a story that took place about four years ago. I was on the phone with a young lady who I did not even know and she is crying her heart out to me. She was telling me how she does not work, goes to school full time, and didn’t know what to do. She was pleading with me to understand how she did not know how she got in the situation that she was in. Of course at that point in time I had no choice but to feel sympathetic for her because I was in the same situation. But I could not let her know that because I had to do my job. Four years ago I worked for the Law Office of Mann Bracken in Atlanta, Georgia and I use to be a debt collector.
According to a 2005 report done by Nellie Mae seventy-eight percent of undergraduate students between the ages of eighteen and twenty-five hold credit cards. Just stop and think, how many credit cards do you have and how many of those credit cards a near the available balance or already maxed out?
All the information that I have learned was gathered through research and personal knowledge.
Today, I hope to persuade you decrease your chances of getting in debt by having no more than two credit cards.
I will share with you some problems that may occur through excessive use of credit cards and offer suggestion on how to prevent credit card debt.
First main point: In a 2008 article, “The Truth about Teens and Credit Cards” by financial writer Dave Ramsey, he stated that teens are the number one target for credit card companies.
The first problem that may occur through excessive use of credit cards is getting addicted.
Credit card companies know if they can get a credit in the hands of a college student they will have a customer for a long time.
Teens think of credit cards as free money, which means they focus on the fact they have the money now and think about the consequences later.
Teens will use the cards even if they don’t need it.
Credit card companies are well aware of the fact that many college students do not work and if they do it is part time.
Credit card companies have a backup plan and know that the majority of its young consumers will ask their parents for help.
The second problem with excessive use of credit cards is the negative effect that is has on credit scores.
Many college students are unaware of what type of damage can be caused if you use credit cards without being able to pay them off.
Seven to ten percent of college students drop out of school because of credit card problems.
Having student loans and multiple credit cards can affect your credit score which will affect your future.
Poor credit score or high debt can affect you getting a student loan, a car, an apartment, a house, or even a job.
The third problem that may occur through excessive use of credit cards is having health problems.
Just to name a few some people get ulcers, stress from worrying about debt, migraines or other headaches, severe anxiety from worrying constantly about debt, severe depression, some people even have heart attacks. 2.
Some teens and adults have even committed suicide over debt. Transition:
Now that I have shared with you some problems that may occur by using credit cards excessively let me offer you some suggestions.
Second main point: There are three ways you can decrease your chances of getting in debt.
First, become knowledgeable about credit cards
Financial institutions prey on teens and young adults without educating them first.
Know what type of credit card you are getting.
Charge card or credit card?
Read the fine print.
Know what your APR, Annual, and other fees will be.
Know what creditors are looking for.
According to a 2008 report by the Federal Trade and Commission creditors are most concerned with:
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