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Don't spend what you don't have, expert says
8.10.2008
Graduates could be creating long-term financial problems for themselves by using their credit cards for purchases they cannot really afford, it has been claimed.
David Kuo, head of personal finance at Fool.co.uk, said given present economic conditions, it is a "very difficult time" for new graduates.
Although interest rates on student loans are "relatively low", Mr Kuo said graduates should still remember that it is important not to spend money they do not actually have.
"I think the golden rule is if you can't afford to pay for something with cash then you certainly can't afford to roll in on your credit card because you will be storing up problems for the future," the expert remarked.
Recent figures published by the Liberal Democrats suggested that many graduates are likely to be experiencing financial difficulties.
So far, 400,000 graduates have not made any student loan repayments because they are yet to earn above the £15,000 threshold, the report stated.
David Kuo, head of personal finance at Fool.co.uk, said given present economic conditions, it is a "very difficult time" for new graduates.
Although interest rates on student loans are "relatively low", Mr Kuo said graduates should still remember that it is important not to spend money they do not actually have.
"I think the golden rule is if you can't afford to pay for something with cash then you certainly can't afford to roll in on your credit card because you will be storing up problems for the future," the expert remarked.
Recent figures published by the Liberal Democrats suggested that many graduates are likely to be experiencing financial difficulties.
So far, 400,000 graduates have not made any student loan repayments because they are yet to earn above the £15,000 threshold, the report stated.