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"Hi, may I bother you for a moment?" an attractive upper classman, or person asks. "If you sign up for a free credit card, we'll give you a free T-shirt. All you have to do is fill out this form and in a few days, you can have your very own credit card."

"Uh, you mean just fill this out and I can get a credit card? Really? Wow! Sure," the unwary student says.

Students get offers on-line, at department stores, and in the Student Union, from unscrupulous lenders every day. What the student seldom realizes until it is too late is that there is no such thing as "FREE" in this world, and certainly no free money.

I let my daughters have credit cards when they were juniors in college but not before. "But, Dad," they would say.

"You have my Visa check card, if you really need something, call me and ask me if I will approve it." Eventually they got their own cards and they are good girls. They still didn't get it. It was just too easy to purchase things they couldn't afford but really wanted. Six months free interest came and went, then jumped to 18% and then to 23%.

"But that's not fair," they whined to me. With late fees and over-limit fees, a thousand dollar credit limit was two thousand dollars before they knew what had happened.

"Dad, you were right. I need some help with this card. I can't pay them fast enough to avoid the balance spiraling upward to even more each month." If there is anything a dad loves more than hearing he was right, I'm not sure what it would be. It is worth the two thousand dollars it cost, multiplied by the two girls, for a total of almost five thousand dollars for them to learn to manage their credit instead of the lenders managing them .

Did you understand me to say that it is worth five thousand dollars for students to learn? It is, but can and should be avoided. Banks should not be able to prey on the unsuspecting: students or others. Excessive interest rates and fees were illegal until predatory banks convinced Congress to not limit their greed. Now, credit card debt is rampant and one of America's weaknesses. Easy credit and immoral lending practices make both participants guilty of irresponsible actions, but the nation as a whole will pay for the misdeeds of those who still think they can spend today and pay tomorrow.

"Dad, will you loan me the money to pay off the credit cards?"

"No, honey. If you can't make payments to them, how can you make me payments?"

That's what America is doing now, borrowing in an effort to get out of debt. It doesn't work. Here is how I did it for the girls:

"I'll make payments and you make payments to the company until it's paid off. If you miss your payment, then I'll quit making my payments. How is that?" We did it, both of the girls, a few years apart. Now, they both have good credit scores and own their own homes, with fixed rate mortgages in line with what they are able to pay comfortably. Like I said, it's worth it for them to learn, but it shouldn't be so difficult or so expensive.

Hearing, "Dad you were right" ... priceless.
[This article was written in 2007, before the crash of our economy in late 2008 and early 2009. It is pertinent to our present circumstances even more than it was when it was written. It is easy to blame our economic recession on banks, congress and our past president-and accurate to some degree-but Americans need to learn to manage their personal budgets, their credit card purchases and mortgages better. Hard lessons are painful, meaningful, and long-lasting.]

Learn more about this author, Will Kester.
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