Finances in College: An Overview

Today is the first day of the rest of your credit history.

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You may not realize this, but in the eyes of the master computers and credit bureaus of the world, you are about to become a significant entity. How you handle all your financial tools creates a "profile" or credit history. The profile you develop now will determine your future ability to get a loan, set up credit, rent an apartment, get a phone line, create an account with a utility company or even get a satellite dish. In all probability, you'll start with one or some of the following:

Credit card
Represents a line of credit that lets you make purchases.

• Remember, this is not plastic. This is real money that has to be paid back.
• You need to pay the bill on time (at least the minimum payment).
• Know what grace periods, annual percentage rates (APR), interest rates, annual fees and credit limits are.
• Report lost or stolen credit or debit cards IMMEDIATELY. Follow up in writing.
• Credit card caveats

ATM/debit card
Differs from a credit card because the money is deducted directly from your checking account.

• Know what the transaction fees are.
• Memorize your PIN number and keep it secret.
• Choose an ATM machine that's well lit; fill out your deposit slips in advance.
• Put away your card, money and receipt before leaving.
• Enter all withdrawals and deposits in your check register.

Checking account
In addition to understanding service charges and minimum balance requirements, you need to know how to:

• Write checks.
• Keep a register.
• Reconcile the account.
• Check the statement (match ATM deposits and withdrawals against receipts).

Bills in your name
Ignoring bills or forgetting to pay them can lead to discontinued telephone or electric service or red flags on your credit history.

• Highlight the amount due and the date due when you receive them.
• Make sure your check is mailed in time to be received by the company by the date due; otherwise you'll be slapped with a finance charge.

Understanding how your finances work will put you right on the money.