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StreetWise Guide to Using Financial Services

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by will dehoo, dcu show me spokesperson

The Scoop on Credit Cards

You've got big plans for the future: move away from home, buy a car, and be more independent. But have you thought of how you are going to pay for this? Do you have some money saved? Or are you planning on using credit cards to achieve your dreams? If you're thinking the credit card way, think wisely. Credit cards can lead you down a dangerous path, if used incorrectly.

The average college senior has about four credit cards, but only 50% of those students have a job. So how do these students pay their credit card bills? They don't. At first, they may use one credit card to pay the other credit card bill. Then they just start ‘defaulting' on their bills. From that point on they may have credit problems that could eventually lead to bankruptcy. Here's a scary fact: bankruptcies of people ages 18-24 have increased 96% in the past year.

The Good Side
Life without a credit card can be hard. Not only do you face challenges when shopping online and accessing emergency funds, but your loan rates could suffer due to a lack of credit history. Luckily, establishing credit is easy when you have a good relationship with your credit card! Once you've made your DCU Visa® your primary card, here are some guidelines to follow for your utmost safety:
  1. First, be very detailed and prudent when it comes to your credit.
  2. Next, follow these tips for using credit cards:
    • When considering a cash advance on your credit card, understand all the terms and conditions associated with them.
    • If you receive credit card checks in your statements, make sure you know the terms and conditions associated with them. They are like a cash advance.
    • Never use your card to finance purchases you can't afford to pay off quickly. Pay your balance every month, if possible.
Most Important Tactic: "Sucker Punch!"
Work through the "Sucker Punch" video module here. "Sucker Punch" is an interactive Foolproof Solo video module on credit cards. It tells you the truth about credit cards. Just sign up and go straight to Module Five.

See ya there!

Cheers,
Will

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Visit Show Me and FoolProof Solo online for more money management advice and ideas. Visit dcu.org and select "StreetWise" then "Show Me."

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Digital Federal Credit Union
PO Box 9130
NCUA DCU is an Equal Housing Lender Marlborough, MA 01752-9130
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