![\"\"](\"http:\/\/www.cusjc.ca\/ottawainsight\/wp-content\/uploads\/Balnar-photo1.jpg\" "\\"Balnar-photo1\\"")
<\/a><\/p>\nFinancial advisors suggest students get a credit card and make small purchases to build their credit score<\/p>\n
According to the Canadian Federation of Students, thousands across the country echo her concerns. That\u2019s why some financial analysts say students need to build a strong credit rating more than ever.<\/p>\n
Sheri Creese, an Ottawa-based mortgage broker, says a credit score, also known as a credit rating, is basically a spending resume.<\/p>\n
\u201cYou see a lot of students brush off their payments like it\u2019s not a big deal,\u201d stresses Creese. \u201cBut it is. It really is – it\u2019s a really big deal.\u201d<\/p>\n
A credit score is calculated by lenders by examining past spending records like credit cards, cell phone charges, cable, internet charges, loans and rental payments.<\/p>\n
Creese says without a good credit rating, students and new graduates will be rejected when applying for a loan for a house, a mortgage, a car or other desires <\/ins>in the future.<\/p>\n \u201cLots of people want these types of things,\u201d says Michael Carson, a bankruptcy trustee with Spurgeon Carson Associates. \u201cYou can\u2019t let poor spending now affect your spending habits later.\u201d<\/p>\n Spend early, pay often<\/p>\n Carson says it\u2019s common for students or recent graduates to approach him with mounting debt or poor credit. He says there are ways to avoid a bad credit score, even if you don\u2019t have much money.<\/p>\n \u201cCredit cards are available all over university campuses. If you take one of those out, keep a small running balance, and always pay it off you can develop a favourable spending history,\u201d he says.<\/p>\n Creese agrees. She says <\/ins>taking out a small line of credit from a bank and paying it off quickly while always paying your cell phone bills are simple ways to build an excellent track record. <\/ins><\/ins><\/p>\n <\/ins><\/p>\n \u201cIt\u2019s definitely something you have to work at, but something that can be achieved if you manage your funds right,\u201d she says.<\/p>\n Easier said than done<\/p>\n But students say keeping a polished spending record is not that simple.<\/p>\n Sandy Hudson, the Ontario Chairperson for the Canadian Federation of Students (CFS), says it\u2019s unrealistic to think most students can pay off even small totals on a credit card.<\/p>\n \u201cHow are we supposed to build a line of credit if we\u2019re already flooded with debt? I get the sense this is an overwhelming problem for students. It\u2019s really depressing,\u201d she says.<\/p>\n According to Statistics Canada, in 2005, 57 per cent of graduating students had student loans and average debt was approximately 18,800 per student. <\/ins><\/p>\n <\/ins><\/p>\n The combined student debt <\/ins>in Canada is now approaching 15 billion dollars, according to the CFS.<\/p>\n Success is possible<\/span><\/p>\n Despite stories of frustration with payments, at least one student says this financial advice can work. Fourth year Carleton student Ginny Powell says she has worked on her credit rating for a while, despite using a line of credit to help pay for her education.<\/p>\n She says the results were incredible as she and her boyfriend were approved for a mortgage on their first house before graduation.<\/p>\n \u201cI always have a small running balance on my credit card, and I always worked hard to pay if off,\u201d says Powell. \u201cMy boyfriend made sure he paid his car loans and now we have a house.\u201d<\/p>\n Powell adds she also used her good credit rating to secure a line of credit.\u00a0 She says she\u2019s confident she\u2019ll be able to pay it off.<\/p>\n \u201cIt makes balancing her finances easier while also building a good credit history,\u201d she says.<\/p>\n Carson says debt is not a problem if managed properly. He suggests a better debt awareness programs at universities.<\/p>\n \u201cWhy not have a frosh event, or something in the first couple weeks of school, that focuses more on how to develop good spending habits?\u201d he says. \u201cI hate to see a student\u2019s rating dip because of an honest mistake they made in first or second year.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":" Some university students are learning the hard way about what a poor spending record can mean for their future. One<\/p>\n","protected":false},"author":39,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1,8],"tags":[],"class_list":["post-2729","post","type-post","status-publish","format-standard","hentry","category-news","category-personal-finance-2012"],"_links":{"self":[{"href":"https:\/\/www.cusjc.ca\/ottawainsight\/index.php?rest_route=\/wp\/v2\/posts\/2729","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.cusjc.ca\/ottawainsight\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.cusjc.ca\/ottawainsight\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.cusjc.ca\/ottawainsight\/index.php?rest_route=\/wp\/v2\/users\/39"}],"replies":[{"embeddable":true,"href":"https:\/\/www.cusjc.ca\/ottawainsight\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2729"}],"version-history":[{"count":14,"href":"https:\/\/www.cusjc.ca\/ottawainsight\/index.php?rest_route=\/wp\/v2\/posts\/2729\/revisions"}],"predecessor-version":[{"id":2826,"href":"https:\/\/www.cusjc.ca\/ottawainsight\/index.php?rest_route=\/wp\/v2\/posts\/2729\/revisions\/2826"}],"wp:attachment":[{"href":"https:\/\/www.cusjc.ca\/ottawainsight\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2729"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.cusjc.ca\/ottawainsight\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2729"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.cusjc.ca\/ottawainsight\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2729"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}