Transition from College

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Transition from College

Postby Collegeguy » Mon Sep 22, 2014 9:39 am

I'm graduating from College this year and am planning to continue for a PhD (so I'll be in school for awhile without my income going anywhere). I want to make sure I'm doing everything right and to share a few ideas.

I've had a plain visa from my credit union with a low APR (<8%), but no benefits. I've had this card for almost 5 years and decided I wanted to take whatever actions I needed to to boost my credit as I transition out of college. I got that card in high school with my dad as a cosigner.

I just recently learned about the credit utilization, which I didn't realize was eating me up with a low credit limit. I got my credit union visa credit limit doubled to 2k, which was a hard pull. It's still joint with my father and I can't make that go away, but I don't want to consider closing my oldest account.

I'm particularly interested in rewards cards, so I applied and was approved for both a Chase Freedom ($1200) and a barclaycard's Sallie Mae MasterCard ($3400) without a cosigner.

My assumption is that the three hard pulls are going to hurt my credit score in the short run, but that it will help it in the long run because of the low credit utilization score and age of the account when I'm like 27. It also appears that I have the best credit cards possible unless my income triples, making a rewards card with annual fee potentially worth it.

Am I doing the right things?

Also, it appears as though you can use UPromise to convert the Sallie Mae points into checks at no cost instead of statement fees. Just thought I'd make that note.

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Postby MemberSince99 » Mon Sep 22, 2014 2:12 pm

In my opinion, yes.

Just don't spend more than you can afford and you'll do terrific. The only way you can mess this is up is to be like our government and spend money you don't have. Treat them like they are debit cards and it's all good. Get into that mindset and it will serve you well in the future.

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Postby djrez4 » Mon Sep 22, 2014 2:17 pm

Outside of his unsophisticated understanding of economics, Member is right. You're on the right track.
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Postby popamode72 » Mon Sep 22, 2014 2:38 pm

djrez4 wrote:Outside of his unsophisticated understanding of economics, Member is right. You're on the right track.

I was about to say the same thing myself. There's a big difference between the government and a household there that I won't get into detail here but I'll say that it's one of the biggest reasons why there hasn't been some hyperinflationary crash contrary to what some people have tried to fearmonger about or why the US hasn't had to deal with many of the issues that Europe has faced.

Even on the debt clock, one can see that the amount of assets the U.S. has basically dwarfs the public debt anyway which has been there in some way since this country's foundation. If there is any major that has to do with debt, I think private debt is a way bigger issue to deal with and I also think not being on a gold standard for several decades has also contributed to how the U.S. is able to do all this deficit spending in the first place.

Anyway, I think the OP is spot on with his plan and I didn't wanna have to go off topic there but just wanted to get that out of my system anyway.
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Postby Vattené » Mon Sep 22, 2014 4:52 pm

*nonchalant sidestep*

Yep, you are on a good track. The hard pulls will fall off your report in 2 years, so they may well never impact you at all (in any real way, that is).

Keep the credit union card open for utilization purposes, but I wouldn't use it if I were you so I would get more rewards. Maybe a swipe every few months to ensure it isn't closed.

Treat them like debit cards and never carry a balance. On top of that, manage your payments so a low (non-zero) utilization is reporting. If you don't get auto-CLIs within a year, request an increase. Just know whether it will require another hard pull beforehand.
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