Student Credit Card Debt
Here is a scary little tidbit I found in today’s Chronicle Times (published in Cherokee, Iowa). It would seem, according to the story, that a survey was performed that indicated 4 in 10 college students completed a credit card application in order to receive a free gift or some sort of special offer.
Credit card issuers have long used the practice of offering merchandise such as toasters, radios, umbrellas, etc. to get people to open up a credit card account. Credit card companies are particularly aggressive on college campuses. The enticements work… they work far too well.
According to the survey referenced in the Chronicle Times piece, 52% of those students that were surveyed leave college with credit card debt. The average debt is approximately $2800. Couple that with student loans and you’re left in a lousy spot as far as beginning your financial life goes.
What some students fail to realize is that their credit history will have a direct and profound affect on the rest of their lives. Employers now check the credit history of job seekers. The idea behind doing this is to get an indication of how responsible the individual is.
Mortgage companies, banks, auto loan lenders, etc., all rely on the credit history of the individual to determine the credit-worthiness of that individual. A poor credit history, or a large amount of debt will almost guarantee rejection.
So my advice here is to pass on the free gift. If you really have a legitimate need for a credit card then by all means apply for the offer that best fits your financial needs. But I really don’t think a free umbrella is a must have… not for the potential price you may end up paying for it anyway.
Related Information:
- Student Credit Card Debt Reaches Record Highs Student credit card debt continues to mount, reaching record high levels....
- College Students and Credit Card Debt Read this informative article about students and credit card debt....
- College Student Credit Cards – Know What You Are Getting College student credit cards should be carefully examined and compared before an application is ever submitted....
- Proposed Bill Will Make It Mandatory To Disclose Dangers Of Debt There is a new bill being discussed whereby credit card companies would be forced to educate prospective cardholders on the danger of debt....