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Credit Cards 101: What They Don’t Teach You in School

JANUARY 8, 2026 | By Connie L. Oakes, Owner of Oakes Tax Service, LLC & Financial Solutions

Credit cards can feel like a rite of passage into adulthood—but without the right knowledge, they can also become a fast track to debt. This guide is here to help students understand how credit works, what to watch out for, and how to build a strong financial foundation from the start.

📌 What Is a Credit Card, Really?

A credit card lets you borrow money from a bank to make purchases, with the promise that you’ll pay it back later. Unlike a debit card, which pulls money directly from your account, a credit card gives you a short-term loan. If you don’t pay it back in full by the due date, you’ll owe interest—sometimes a lot of it.

📊 Why Your Credit Score Matters

Your credit score is a three-digit number that tells lenders how trustworthy you are with borrowed money. It affects your ability to rent an apartment, buy a car, or even get a job. The earlier you start building good credit, the better your financial future will look.

Key factors that affect your score:

  • Payment history (Do you pay on time?)
  • Credit utilization (How much of your limit are you using?)
  • Length of credit history (How long have you had credit?)
  • Types of credit (Credit cards, loans, etc.)
  • New credit inquiries (How often are you applying?)

🚩 Common Pitfalls to Avoid

  • Only paying the minimum: This racks up interest and keeps you in debt longer.
  • Maxing out your card: High utilization hurts your score.
  • Missing payments: Even one late payment can drop your score significantly.
  • Opening too many cards: Each application triggers a credit check, which can lower your score.

✅ Swipe Smart Tips

  • Start with a student-friendly card that has no annual fee.
  • Set up automatic payments to avoid late fees.
  • Keep your balance below 30% of your limit.
  • Use your card for small, regular purchases you can pay off monthly.
  • Check your credit score for free using apps like Credit Karma or your bank’s mobile app.

Credit cards aren’t evil—they’re tools. And like any tool, they work best when you know how to use them. Swipe smart, stay informed, and build the kind of credit that opens doors—not drains wallets.