Updated October 19, 2017

The American Bankers Association designated October 19 as “Get Smart about Credit Day” to encourage youth to learn about using credit wisely from a young age.

DCBA encourages youth to learn the basics about credit, budgeting, and paying bills on time. Here a few tips to help you get smart about credit:

Strengthen your credit history now: Since you are starting out you may not have an established credit history. That’s OK. If you borrow and pay on time, you can build good credit. Take control of your financial future. Your credit history builds with everything you borrow or lease. Every time you want to buy a car, rent an apartment, buy a house, get a loan, or even get a job, that person or business will check your credit history to see how well you’ve treated other creditors.

Read the fine print of card offers: You will get plenty of credit card offers, but which card is best for you? Before you apply for a credit card, make sure you understand the terms and conditions and compare interest rates and fees from several companies. The interest rate is the amount the credit card company charges you to use credit and it’s based on your credit history.

Know your credit limit: Credit cards have a credit limit, which limits the amount you can spend. A person with a strong credit history can get a credit limit around $15,000 and up. A person with little or no credit history might start with a credit limit around $250-2,000.

Look for a student card: Some credit card companies offer credit cards with lower interest rates and credit limits just for students. These cards can be a way to build good credit, if you use them wisely.

Avoid debt traps!: Some credit cards have extremely high interest rates and fees. They might require an annual fee of up to $100 and interest rates over 20 percent. Avoid them! High interest rates make it very easy to fall into a debt trap, where you can get stuck with a lot of debt and can’t get out.

Review your statements: Every month you will get a credit card statement, either online or in the mail. Do not ignore it. Read your credit card statement closely to make sure all the charges are accurate. If you see a charge you didn’t make or don’t understand, contact the credit card company right away to dispute the charge. If you notify the company within 60 days, they might refund you while they investigate. If they believe the charges are fraudulent, they will reverse the charges permanently. If not, you may be responsible to pay. If you have questions, you can contact us at DCBA for help.

Always pay on time!: Always pay your bill on time. Pay the entire balance if you can, but at least pay your minimum payment every time. If you carry a balance, pay back the credit as soon as possible. If you pay late, you will pay late fees and interest charges can pile up quickly and put you into debt. Set calendar reminders on your phone to pay on time. You can link your credit card account with your checking or savings account to pay your balance electronically.

Check your Credit Score: You can get a free credit report every 12 months from each of the three main credit reporting agencies: Equifax, Experian, and TransUnion. Go to www.annualcreditreport.com to find out how.

If you have questions, contact us at (800) 593-8222 and follow us on Facebook and Twitter.