Making Money Make Sense: BMO Advises Students - Be Smart About Choosing Your First Credit Card

    What you should know about credit cards

    TORONTO, Aug. 14 /CNW/ - A credit card is more than just a charge card.
While it's great for emergencies, it also represents the first step towards
building a good credit history. But it's important to be realistic about your
needs and your ability to manage credit responsibly so that your credit card
serves as an effective and flexible payment tool rather than a pathway to
    Nancy Marescotti, Director, Card Marketing, BMO Bank of Montreal, offers
the following advice to give students the credit card smarts they'll need
before applying for their first card.

    Know your limit

    A credit card is not a blank cheque and shouldn't be treated like one.
Pick a card with a low introductory credit limit. The limit on your card helps
protect you from overspending. If you know you will not be able to resist
splurging, ask to have your limit reduced to a level you can manage.

    Not all cards are created equal

    They come with a variety of rewards, features, fee structures and
interest rates. Take the time to shop around and choose a card that suits your
personal circumstances and specific needs.

    Don't be fooled by introductory 'teaser' rates

    If you believe that you may need to carry a balance, pick a card that
offers a low annual interest rate as your interest rate can make a significant
difference in what you pay. But don't be fooled by 'teaser' rates that entice
you with a short-lived low introductory rate. Once the introductory period is
up, your interest rate could skyrocket.

    Get more out of your credit card with discounts and rewards

    The BMO SPC MasterCard comes with an option to lower your interest rate
without giving up any of the benefits of the BMO MasterCard credit card:

    Discounts - Exclusive Student Price Club discounts and savings on
clothes, shoes, accessories, sporting goods, restaurants, entertainment,
travel and other services at thousands of SPC Card retailers at no added fee.

    Rewards - The BMO SPC MasterCard provides built-in AIR MILES or CashBack
rewards at no added fee. If you anticipate travelling throughout the school
year to see family or friends, a card that earns rewards with every purchase,
such as AIR MILES, makes sense. AIR MILES reward miles can be redeemed for
flights, bus tickets, merchandise and more. If, on the other hand, you would
rather earn immediate savings, a CashBack reward option will put money back in
your pocket for every purchase you make.

    Ink the deal

    Be sure to sign your credit card as soon as you receive it.

    Pay it off

    Always try to pay your balance in full every month by the statement due
date. Otherwise you will be charged interest. At the very least, make the
minimum monthly payment and if you can, try to pay more than the minimum
balance due since the faster you pay off the balance, the less interest you
will pay.

    Build a good history

    Once you've chosen your credit card, use it responsibly. Start building a
good credit score by paying your balance or minimum monthly payment on time. A
bad credit rating can have a negative impact when you want to get a loan, buy
a car or condo or even get the job you want.

    Be loan smart

    The ability to get a cash advance on your card is great for emergencies,
but you'll be charged interest from the moment the cash is in your hands. Try
to avoid taking cash advances on your credit card if at all possible.

    Protect your identity

    Save yourself (and your credit) from identify theft. When you make an
online purchase, make sure the website has security features so that your
information does not fall into criminal hands. If you are providing your
credit card information to a merchant over the phone, ensure the merchant is
reputable. Lastly, do not share your credit card with friends -- any slipup
can put your credit at risk.

    What's required

    Usually, to apply for a student credit card you must:
    Be a permanent Canadian resident;
    Be of age of majority in your province or territory;
    Be a full-time student at a recognized college or university;
    Earn annual income from employment, scholarship/grant, student loan or
     family allowance.

    Information provided by BMO Bank of Montreal. For more information about
    BMO MasterCard, visit or call 1-800-263-2263.

    Free Banking for Students - BMO has made a commitment to help its
customers save money and manage their day-to-day finances more effectively.
Its recently announced BMO SmartSteps program delivers a straightforward
approach to identifying real savings for customers such as through reduced
fees and lower interest costs and BMO is the only bank to offer students free
banking during school and for the first year after graduation. Students who
open a Personal Banking account at BMO can bank for FREE(*) (a savings of $102
each year) and will receive a number of services including:

    -  Up to 30 transactions each month
    -  1 Interac Email Money Transfer per month
    -  Overdraft Transfer Service at no extra charge

    (*) See Backgrounder attached to this release for details

    For more information about financing solutions for students, drop by your
    local BMO Bank of Montreal branch or visit



    BMO's Student Six Pack

    -  Free Banking -- Students who open a Personal Banking account with the
       Plus Plan can bank for Free (a savings of more than $100 each year)
       and will receive a number of services including:
       -  Up to 30 transactions each month
       -  1 Interac Email Money Transfer per month
       -  Overdraft Transfer Service at no extra charge
       -  BMO is the ONLY bank to provide recent graduates with an extra year
         of FREE banking

    -  Premium Rate Savings Account
       -  Competitive interest rate without locking in your money
       -  Up to 30 transactions each month
       -  1 Interac Email Money Transfer per month
       -  Overdraft Transfer Service at no extra charge

    -  Student Line of Credit
       -  Low interest rates - set at Prime plus 2%
       -  Credit Limit -- borrow up to $15,000 in your first year and $10,000
          in each remaining year to a 4-year maximum of $45,000 for full-time
       -  Lower borrowing costs than a student loan -- pay interest only on
          the amount you actually use
       -  Easy access to funds -- use your BMO debit card or your Student
          Line of Credit MasterCard(R)(*), write a cheque or visit a BMO
       -  Easy repayment -- monthly interest-only payments up to one year
          after you leave school
       -  No fees -- no annual or monthly fees, no ABM fees

    -  BMO SPC MasterCard
       -  NO-FEE rewards (AIR MILES or CashBack)
       -  Choice of Interest Rate plans
       -  10-15% off purchases made at thousands of retailers and restaurant
          chains that offer Student Price Card (SPC) discounts

    -  Easy Access to Online Banking Services
       -  Send an Interac Email Money Transfer
       -  Choose a paperless or consolidated bank statement
       -  Change your address
       -  Order cheques
       -  Open a chequing or savings account
       -  Transfer funds between your account and your BMO SPC MasterCard

    -  AIR MILES reward miles
       -  On purchases you make with your BMO Debit Card
       -  On purchases you make with your BMO SPC AIR MILES MasterCard

For further information:

For further information: For News Media Enquiries: Ralph Marranca,
Toronto,, (416) 867-3996; Ronald Monet, Montreal,, (514) 877-1873; Laurie Grant, Vancouver,, (604) 665-7596

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