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What would your mom say if you bought a $176 pair of jeans? Before you get defensive and say they were only $50, consider this -- you charged them with your Credit card, which has an interest rate of 21 percent. Twelve months later, you're still paying for those jeans (which, by the way, have not seen the light of day since the first -- and only -- time you wore them).

So, you've heard all the warnings about high interest rates and lofty purchases, but do you really know what you're getting into when you swipe and sign?

Nearly half of you don't. A recent survey conducted by Citigroup found that 52 percent of College students believe their spending habits will not impact their Credit Report in the future. Over 37 percent think opening new, unnecessary Credit Cards will not lower their credit scores.

CB Teen gives you the lowdown on credit card usage stats, the fine print, and how to refrain from plastic abuse

Plastic Spending Stats
According to Nellie Mae, a provider of student loan programs, 56 percent of college seniors accumulated four or more credit cards in 2004. Most of these students acquired their first credit card during freshman year -- when they turned 18 and were eligible to apply.

Overall, the average outstanding balance on an undergraduate student's credit cards was $2,169. Almost all of these students don't have full-time employment, some not even part-time jobs. So what will happen as student card holders only pay the minimum (sometimes as low as $10) and these balances are carried over from month to month with finance charges?

Fine Print 101
With so many young people in debt, it's no wonder financial experts like Scott Bilker, founder of DebtSmart.com (a credit card information help center) and author of Talk Your Way Out of Credit Card Debt (Press One Pub, 2003), have come forward to help.

One of the most important pieces of information to understand is the credit card fine print, says Bilker. It's seldom read (the font is so tiny you'd need a magnifying glass) and hard to understand (financial organizations sometimes use complicated and ambiguous terms).

To shed some light on credit card fine print, Bilker offers must-know info:

• When the fine print reads "minimum finance charges are anywhere from $.50 to $1 no matter how much of the balance is carried," this means if you have a $40 balance carried forward with a $1 minimum finance charge, the annual percentage rate (APR) works out to be 30 percent plus the credit card's normal rate.


• When the fine print says you have the "option to apply payments in the best way for the bank" (that's actually the way it's worded sometimes), it means that if you have two balances on one card at different interest rates -- for instance, one for purchases and one for Cash advances -- the bank can apply your payments the way it wants. Sometimes they'll lock in the high rate.


• If you're late on a payment, they'll raise your interest rate -- sometimes to over 30 percent. On top of that, there are late payment fees as high as $40. And, when fees are included in interest rate calculations, periodic APRs can be 75 percent or more.

Recovering Credit Card Abusers
They abused their plastic power -- overspending, only paying the minimum, acquiring multiple credit cards. Now they're spending smarter, paying attention to their rates, and on the road to better financial health with stellar credit card ratings. Take their advice ...

Watch out for credit cards awarding high limits, warns Steve Arnold, producer for property and casualty insurance. "When I was 20, one of my credit cards gave me a $7,500 limit. By the time I was 21, it was maxed out," explains the 24-year-old. "I'm still hurting from my over-spending. Don't spend a lot until you have a substantial income and job security."

Spend wisely and save, says Max Debarros, department manager for an advertising agency. "Don't get a credit card if you don't have a stable job," advises the 26-year-old. "Only spend a portion of your earnings (15 percent or so), and stash the rest in the bank."

Use credit cards only for emergencies. That's from Mike Scher, tour publicist for Another Reybee Production, a public relations agency. "I used to use my credit cards like Monopoly money. Ever since I moved to New York, I forced myself to use them only in emergency situations," explains the 26-year-old. "Credit cards were my form of ATM. When I got my bills, I'd notice the number of useless items I purchased. You don't realize you're paying for all this nonsense since you don't get the invoice until a month later."

Avoid debt in the first place, advises Anita Cheung, Business development coordinator for an entertainment services company. "When my cousin declared bankruptcy at the age of 25, I learned that credit cards can be very easy to abuse and young people can easily overspend," explains the 25-year-old Anita. "Use a debit card so you can easily monitor the amount of money you spend. Once you become more comfortable with your finances, get a credit card and watch your monthly spending carefully."

Test Your Spending Smarts
You could be the one paying $176 for a $50 pair of jeans. To ward off potential credit card mishaps like that, take Citi's Credit-Ed Challenge. The free, one-hour, interactive financial education workshop is available at www.students.usecreditwisely.com.

Once you complete that, begin the Credit-ED Challenge Certification quiz to become Credit-ED Certified. Then, charge all you want. (Just kidding!) Just because you're certified doesn't mean you're totally credit card responsible. Apply lessons learned in real-life -- then you can brag about how credit card savvy you are.

Lindsi Hedrick, a workshop facilitator for the Credit-ED Challenge, continues to apply lessons learned from her experience with the program.

"It really helped me with my overall knowledge about credit," she explains. "I would recommend this program to other young people because there's so much to know about credit and how bad credit can affect you. We're only taught a small portion of it in school and from our parents."

Her advice to young credit card users: "Don't use your credit cards like cash -- you do have to pay everything back and then some." Pay your balances in full and on time when the bill comes, she recommends.

And since accidents and identity theft are known to happen, Hedrick always checks her bills to make sure there are no unusual purchases on the account


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Ysolt Usigan is a frequent contributor to The CollegeBound Network. Learn more about finding a school that's right for you.

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