A UW Credit Union branch manager shares easy tips on how to avoid the financial mistakes he commonly sees students make. Dodge these pitfalls to set yourself up for success.
Failing to Pay Bills On Time
When you don’t pay bills on time, your credit score takes a negative hit. Why should you care? Because without a good credit score, you won’t be able to take out a loan for a car or buy a home later in life.
Tip: Can’t remember when payments are due? Set up recurring automatic payments for your UW Credit Union reserve line or credit card or Email & Text reminders. And don’t forget to pay bills even if you’re not there during breaks or if you are going to be gone for a long time.
Shopping ‘Til You Drop
Shopping today becomes one giant bill later. If you spend money on impulse purchases, you may not have enough to pay for food and other living expenses. Plus, if you spend more money than what’s in your account, you’ll incur overdraft fees.
Tip: Create a budget and then stick to it. Include money for entertainment, clothes or dining out, but make it fit within your plan. Use Money Management Tools for help.
Not Establishing Credit
Being an authorized user on your parents’ credit card will not help you build your own personal credit. Why does building credit matter? You’ll be able to rent an apartment on your own without the need for a parent to co-sign your lease. Plus, you’ll qualify for lower loan rates when you want to buy a car.
Tip: Establishing credit is easy. Simply open a credit card, then be sure to make payments on time.
Becoming a Victim of the “Ostrich Syndrome”
Ignoring your financial mistakes doesn’t make them go away. In fact, if you ignore them long enough you’ll wake up to a call from a collection agency. When that happens, your credit score takes a devastating dive.
Tip: Reach out to your creditors if you didn’t pay something or didn’t receive a bill. Make sure they have your most up-to-date mailing address on file.
Want to know your personal credit score? See it for free in Web Branch. Plus, review your credit report for free, checking it for errors. We can also review your credit report with you during a free Credit Consultation.
Have a Question? We’re Here to Help
To learn more, visit UW Credit Union website at uwcu.org or stop by the branch on campus.