05/14/2012 06:47 pm ET Updated Jul 14, 2012

5 Credit Card Rules for New Grads

It's that time of year when tassels are turned and graduation caps are tossed into the air. And ready or not, a new group of young adults venture out into the real world.

If you just graduated, you might be looking forward to managing money on your own. Certainly, it's deliciously liberating. But it can also be tricky, especially with credit cards because it's so easy to spend like a maniac and get yourself into debt.

So to help you get started on the right track, I've put together five credit card rules that you should always keep in mind:

Rule #1: Don't fall for flattery

You've probably received credit card offers while in college. You may even already have one or two cards. But once you're employed, expect to get a ton of mailed offers.

The envelopes will entice you with language such as, "You've been selected!" and "You deserve this opportunity!" Card issuers will do their best to make you feel special and wanted.

Banks do want you, but they also want millions of others whom they told are special, too. Don't apply for a new card unless you actually need it. Make a rational decision based on your needs and don't fall for the hype.

Rule #2: Read the fine print before you apply 

If you do decide you need a credit card, it's OK to consider the mailed offers. But also get online and check out credit card comparison sites, like, where you can search for cards based on what your needs are and what cards you would qualify for. (You can figure out which cards you would qualify for before applying for them by checking your credit report card.)

Narrow the list down to about a half dozen candidates (maybe less, maybe more, depending on what category you're looking at). Then read the fine print for each one so you can make an informed choice. You want the card that matches your lifestyle and your needs. For instance, if you're driving a long distance to work, look at cash-back cards that offer a gas rebate.

There's really no substitute for reading what's often called "mouse print." Think of this as an investment in your financial future. When you know how to earn rewards or avoid fees, you'll benefit financially.

Rule #3: Pay the balance every month

Honestly, this is a rule that everyone -- regardless of age and credit experience -- should follow. Now is the perfect time to develop this habit. Pay your bill off every single month with no exception. Set up a budget so you know exactly how much you can put on credit cards for a given month. Don't exceed that amount because if you do, you might not have the cash flow to pay it off. Then you end up paying interest expense.

If you keep spending, this snowballs and before you know it, you're in credit card debt. It's a depressing place to be. I've overcome it and many others have, too, but you don't want to be in that position. It will be a financial setback for a long time.

Rule #4: Pay the credit card bill on time

This may seem like a no-brainer. Of course I'll pay on time, you say. Well, good intentions sometimes go awry in real life. You must have a system in place so you don't forget. You're an adult now and you've got work responsibilities, household chores, dry cleaning to drop off. And, of course, a social life to keep track of.

It's easy to get really, really busy and let the bills slip. Set up reminder e-mails or text alerts from your card issuer. Or use free money management software like Mint and set up weekly bill-paying reminders via e-mail. Handle this in a way that works with your organizational style. Just don't use your memory as your sole method.

Rule #5: Make a vow to learn about personal finance

Humans don't instinctively know how to manage money, let alone credit cards. But even if you weren't taught money skills as a child, you can teach yourself now.

There are lots of personal finance books out there. I like Clark Howard's books because he offers good tips for making the most of your money. Liz Weston and Farnoosh Torabi (her books are targeted to young adults) also have some really good personal finance books you should read. If you have a Kindle, you can get most books in e-book format and save money.

And don't forget, the Internet is loaded with websites that want to teach you how to handle credit or set up a spending plan. For instance, free webinars are offered by CredAbility. The teachers are certified by the National Foundation for Credit Counseling (NFCC).

But listen, if you ever find that you're over your head in debt or cash-flow issues, ask for help. So many grads already have student loan debt and if you add credit card debt to that, you'll feel overwhelmed. Being in debt is a lonely feeling and there are organizations filled with counselors who want to give you advice. You can reach out for help from the NFCC or from CredAbility.

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