6 Ways To Prevent College Credit Card Debt

Getting your first credit card is an exciting proposition. But taking on too much debt with it is all too easy. For college students with lots of expenses but little income, getting out of debt can be a challenge. Here are some steps that can help AVOID that type of debt.

Here's a SUPER common scenario:

Sarah get's her first credit card. She made the decision to purchase the shoes she's had her eye on for agesssss and agesss. She figured that she has the money so why bother waiting? She doesn't have to wait for her salary. She goes ahead and purchases the shoes and a couple of other things she always wanted. She forgets about her budget in the moment of flashy, plastic glory.  She tells herself she will just pay it back later. Sarah doesn't stick to her budget and spends way more than expected. Now her credit card payment is way too high to be paid back in full and she resorts to paying just the minimum payment with interest. And then the debt cycle starts.

Yup, we see this example too often to count.

According to CollegeFinance.com, the average credit card debt for college students is $3,280. This is probably a result of the high cost of college and the necessity for students to use credit cards to pay for expenses like textbooks or even unexpected expenses. As a result, credit cards are just as readily used for luxuries like fast food meals or internet shopping binges that, if you're not careful, can lead to significant debt.

Thankfully, there are ways to combat accruing credit card debt while in college. This is how you do just that!

1. Do your research:

There are a few things to be aware of after deciding to apply for a credit card. You must educate yourself on how credit cards operate, the various types of cards that are available, and responsible credit card usage because they can play a significant part in your personal finances. Additionally, you should be aware of how credit cards impact your credit score and can support your future financial objectives, such as leasing an apartment or getting a car. Making informed selections about your student finances with the aid of some credit card research will increase your self-assurance in your capacity to manage money.

2. Establish a budget

Always ensure that you have a budget and a new budget each month. If you accurately fill out your monthly budget sheet, you'll know exactly how much money—also known as discretionary income—you'll have left over. Put the money toward your emergency fund or a sinking fund; but, if you opt to use your credit card for non-essential items, be careful that the sum does not exceed your monthly discretionary income. You'll be less likely to rack up credit card debt while in college if you set a spending cap for yourself.

Read: 5 Credit Card Mistakes to Avoid During Tough Times

3. Get rid of spontaneous purchases

Many college students use their credit card for impulsive expenditures, or last-minute purchases made without taking their budget into account. Although clicking "add to basket" or swiping your card can be entertaining, it's crucial to think carefully before making a purchase. It may not seem like you are spending money when you use a credit card. This is because you're paying with a credit or debit card rather than with cash. However, the money you are spending is actual money and must be repaid on schedule. Maintaining a record of all your purchases will help you figure out how much money you have spent and perhaps discourage you from making additional purchases until you are in a position to do so.

Read: Best Credit Cards for Students of November 2022

4. Consistently pay bills on schedule

You should try to always pay your credit card account in a timely manner. No matter if you missed a payment unintentionally or on purpose, you will start to incur late fees as soon as you do. If you're trying to pay off or prevent credit card debt, this could raise your bill, which isn't helpful. Additionally, one of the key components in evaluating your credit score is your payment history. One missed payment could result in a decline in your credit score. Positively, consistent on-time payments can boost your chances of receiving a credit limit rise. Basically, by paying your bills on time, you can avoid interest charges, get rid of late fees, and easily establish a positive credit history.


Read more: 5 Ways to Save Money While in College

5. Pay more than the minimum amount

The average college student typically only pays the minimal amount owing on their monthly credit card statement, which is a common credit card error. It may be alluring to merely pay the minimum amount due because it can be a relatively modest portion of your monthly credit card bill. To avoid paying interest on purchases, you should strive to pay off your entire debt each month when you receive your bill. Always try to pay more than the minimum amount due, even if there will be months when it is impossible to pay off your statement in whole. In doing so, you will be able to pay off your entire balance faster and spend less in interest fees over the long run, saving you money.

6. Find a side hustle

Find ways  to boost your income!  By "finding" additional funds, such as by exploiting student discounts, you can do this. By taking on a part-time work or pursuing a side hustle, you could also increase your income. Whatever you decide to do to raise your income will assist you in paying off debt. If you can eventually control your spending, you'll have more money to add to your savings, put money into your retirement account, or use to pay off student loans.

Read more: 5 Ways You Can Save Money Today


By not using a credit card at all, college students might fully avoid accruing credit card debt. That being said, a lack of credit score, however, may put students at a disadvantage for upcoming activities. Without credit, a student may not be authorized for loans, may be unable to rent the apartment of their choice, or may be subjected to higher interest rates, increasing their debt load in the future. Despite how scary credit card debt may sound, managing your credit just requires dedication and some practice. Just remember that if you adhere to these suggestions, you will be using your credit card wisely.

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