As the summer draws to a close,
"Although a credit card may seem like an easy financial fix today for many young, college age consumers, the long-term repercussions of exceeding your credit limit or accumulating debt with extremely high interest rates can be devastating," McDaniel said.
The CARD Act prohibits solicitors from marketing credit cards within 1,000 feet of a college campus or off-campus student gatherings, such as athletic events. Under the law, solicitors are prohibited from issuing credit cards to consumers under the age of 21 unless the consumer has submitted a written application that includes the signature of a parent, legal guardian or spouse that has the means to repay debts incurred by the account, or has submitted financial information that demonstrates the applicant's ability to independently repay the debt.
Credit card marketers are also prohibited from offering tangible items, such as T-shirts or key chains to encourage students to apply for credit cards.
For young consumers considering signing up for a credit card, McDaniel offered the following tips:
* Avoid accepting multiple credit card offers. A large amount of credit can lead to an enormous amount of debt.
* Choose a card based on the cost of credit which includes the interest rate charged on credit balances and other fees.
* Submit payments on time. Consistently making timely payments is the only way to improve your credit rating and qualify for less expensive credit.
* Pay the balance owed each month. Although it may seem easier to pay the minimum balance, doing so costs more in the long-run and it takes much longer to pay off the debt.
* Be cautious of running up a balance on a credit card with a temporarily low interest rate. Once the temporary rate expires, the permanent rate may turn out to be more than you can afford.
* Steer clear of "over-the-limit" protection. It can be very expensive in the long-run, especially on small transactions.
* Protect your credit score by refraining from "maxing out" a credit card.
For more information, contact the
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