Answers to top student money questions: Part 2

Thanks for taking me up on my offer to help you answer your questions about money, credit, debt, romance and finance and landing (or keeping) a job.

For all of you who were courageous enough to ask your questions, I applaud you.

For those of you who still have questions that need answering, I hope what follows will offer you some insight and direction.

MONEY

What’s the best way to lower my credit card interest rate?

It’s simple, call the credit card company and ask them for a rate reduction.

If you’ve been good about paying your credit card bills on time and not maxing them out or going over the limit, then you’ll be in a much better position to ask for an interest rate reduction.

The bottom line is that credit card companies don’t want to lose your business.

So if they have to lower your interest rate by a few points to keep you

as a customer, they usually

will do so.

Always remind the creditor that there are other companies who want your business

and have them look for ways that they can keep you as

a customer.

They may even offer fee reductions or waivers as a way to keep you satisfied.

ROMANCE & FINANCE

I want to buy my girlfriend/boyfriend nice things but how much is too much?

It’s hard to put a dollar amount on how much to spend, especially when it comes to birthdays and holidays.

Often we want to impress and get the big WOW reaction, but I have been guilty of breaking the bank and maxing out credit cards only to pay the hefty price tag later.

The best advice I can give is to set spending limits upfront on gifts, this will take

off the pressure and turn on the creativity.

When you stop focusing on the amount you’re spending and put the attention into the thought behind the gift it’ll last a lot longer and mean a whole lot more.

Also, reduce the pressure to produce that one-of-a-kind gift by giving smaller gifts more often rather than putting all of your energy into the big gift.

DREAM JOB

How soon should I start putting money in my 401k plan after I get a job?

As soon as your company allows – it’s free money! Even if you can only save $50 per paycheck, you have to start somewhere.

There is no such thing as playing “catch-up” if you don’t discipline yourself at the beginning.

It’ll be much harder to make the switch later on.

Also, look into other pre-tax benefits such as travel allowances, flex-spending accounts and any other opportunities that your company offers to lower your taxable income.

On average every $1,000 you put in (the max is $5,000 per year) cuts your tax bill by

about $300.

Do you have a question for Sanyika? E-mail her at questions@collegestudentusa.com

SANYIKA CALLOWAY BOYCE
Young Money Magazine

Related Posts:

1. Answers to top student money questions: Part 3
2. No money for gifts? No problem
3. Making Cents of: Investing your money
4. Consolidate your student loans before June 30
5. NPR’s ‘Car Talk’ answers automotive questions with a twist