Free Money! You've probably heard that the law changes over the past few years are supposed to protect college-aged young people from a lot of the abuses credit card companies have aimed at us for years.

Well, guess what: FoolProof thinks no law is really going to protect you, unless you're very wary.

We think you'll still see students signing up for a free coffee mug or a free t-shirt, and of course a credit card at college registration—the required act to get the mug and shirt.

Filled with Loopholes

If you're college-bound, we think you'll still be opening your mail at home and get all the "free" plastic money offers. So why won't the law work? Because it's filled with loopholes. The law says a credit card company can't give you a credit card if you are under 21 unless one of these three things happens:

• unless you can prove you have income to pay it
• unless you have a co-signor
• unless you pass a "certified" test

All three points sound good, but here's the reality: who determines if you have enough "income" to pay your credit card bill? The credit card company. And who defines the standards for a co-signor? The credit card company. And what about that "certified" test? Who do you think will end up recommending certain tests? The credit card companies.

The end result: many credit card companies will still find a way to qualify you for a credit card, whether or not you can pay it, even if getting the card will ruin you. And here's what we mean by "ruined."

Reality*:

• Half of you will probably still have trouble paying your credit card bills.
• More than fifty percent of you will still say your credit card debt impacts your ability to study.
• A quarter of you will probably end up thinking about dropping out because of those credit card bills.
• Maybe thirty-one percent of you will be forced to cut your class load and take a job to pay your credit card bills.
• Tens of thousands nationwide under 25 will declare bankruptcy this year alone.

But why would banks still want to give credit cards to young people who can't pay them?

Banks know that about 75 percent of students will keep banking for decades with the first bank that gives them a credit card—even if the students ruin both their credit and their school opportunities with that bank's free credit cards. They know they'll own you down the road, whether you pay or not.

Don't Be a Chump

Don't fall for easy plastic. Our advice?

1. Never get a credit card unless you—not the financing institution—know for a fact you can pay the bills.

2. Don't get more than one credit card.

3. If you've got more, cut the extras up, and pay the balances off.

4. Never make only "minimum" payments on cards. Pay more.

5. Don't charge! Pay cash.

6. Read our "5 Credit Cards and Free Goodies" article and learn how to correctly handle your credit cards and balance your checking account.

Good luck!

* According to a study by the University of Oklahoma.