Credit Card Debt Among College Students
 

I subscribe to a couple of e-newsletters and the topic in one of them was about credit card debt. This made me think of a story I saw last week on either Dateline NBC or 20/20 Downtown. The reporter interviewed several college students and those who have graduated.

The students spoke of the incredible debt they gained from receiving credit cards while in college. One gentleman said he had to forgo graduate school because he could not afford it due to the amount he owed.

Then, the reporter uncovered a dirty little secret. Some colleges actually are paid thousands and thousands of dollars by the credit card companies to come on campus and solicit credit card applications to the students. They also sell students names and phone numbers so the companies can solicit by telephone (I always wondered how they knew my name and phone number in my residence hall).

One school in Tennesse refused to be interviewed, while some state lawmakers are finding ways to ban this practice. They say that students without an acceptable source or of income or no incmome at all should not be constantly tempted to apply for credit.

Of course, the credit card companies continue to say that most college students know how to manage the use of credit wisely. However, there is still a somewhat high rate of students who are unable to handle the privilege.

I remember lots of representatives on my campus were always set up in the student center. They gave away t-shirts, cups, pens, etc. to attract students.

Since we have so many college students and recent grads on this board, I was just wondering what everyone thought about this.

I'm sorry for the long post.

As someone who has weathered the storms of having too much credit in college, and as someone who understands marketing principles, I have to say that the best approach is for students to be educated about credit BEFORE stepping foot on campus. Colleges and universities are not going to stop accepting money from companies who give big bucks in exchange for having access (exclusive access in the case of soft drink makers) to college students (who are mostly over the age of 18, btw). So, parents, mentors, and concerned orgs. (hmmm, a chapter program, perhaps?) need to give kids financial info long before they hit Poduct U.

I would suggest that parents include their children in the family budget planning process, and that kids be given and/or earn money that they must budget and account for. Or, money management/debt counseling seminars and courses should be developed by interested orgs. for pre-teens and teens.

Even though I myself made BIG, HUGE, LARGE mistakes with money and credit as a young adult, I don't think anyone tricked me into assuming the debt; I was just stupid about it. Plenty of my friends were too, but plenty were not. I think older adults need to constantly counsel young kids, teens, and young adults about the value of money, the concept of debt, and the reality of INTEREST! I have done this with my younger sister, who is now a senior in college. After seeing her two older sisters make fools and paupers of themselves, she has been much more responsible with her own money and credit history.

DG

I can certainly relate to credit card debt. I am in my third year cf college and I am already over $3,000 in debt! All accumulated during my FRESHMAN year. These credit cards wont admit it, but they target young students who are not up to being responsible for their expenses. In NYC they even give away candy and gifts to people who will sign up for them. Isn't that ridiculous!!? In the end though you have to be responsible for your actions.... you have to pay them. It is just a shame that they are (I was) lured into them.

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In complete darkness we are all the same... It is only our knowledge and wisdom that separates us... Don't let your eyes deceive you

The Diva Truth

A couple years ago there was an article in the local paper about how outrageous credit card debt is among college students. The article reported that my alama mater no longer allows credit card companies to solicit on campus. The companies were paying organizations to get people to fill out their applications, a commission kind of thing for whatever number they could process and approve. I was pleased to see this was stopped.
I got my first major credit card my sophomore year (spring '88) and used it wisely for about a year. To make a long story short, it's only been paid off about two years.

PearlsnIvy,

I'm glad to hear that one college has but a stop to it. I don't think any school should sell their students' private information to companies just to line their own pockets with some more green.

My freshman year I racked up over $10,000 in credit card debt (hello spring break). Because of it my credit was trashed and I had to leave school for over a year in order to pay the cards off...
It was horrible, but I was ultimately responsible for my mistake. The credit card companies are doing what credit card companies do (and any company for that matter), making money. It is a shame that college students are targeted, however, blaming the credit card companies isn't right... we alone are responsible for our decisions in life. Visa didnt force me to buy tickets on a cruise, and MasterCard didnt force me to purchase a new wardrobe everytime the weather changed; I made that choice and had to live with it.
I think that, not only colleges, but parents/gaurdians should educate those new to college about credit, debt, and personal responsibility. Perhaps a session in orientation could be devoted to the cause.. "Personal Finance"
What do yall think?

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Faced with the Divine, I was asked; "What one gift do you seek?"
I answered ever so meekly; "I seek Honor, Truth, Integrity, and Wisdom, yet those are four. How am I to choose?"
The answer came as a pounding whisper; "The four you seek are but one. I grant thee Compassion; for without it the four make none."
Author - me

I know this is an OOOOOOLLLLLLDDDD topic but my boyfriend and i were just discussing this a couple of days ago. i requested a copy of my credit report and was astonished by the info it contained. i mean it had all my business on it. the good thing about it was that i had only been late with a payment once http://www.greekchat.com/forums/ubb/smile.gif but my question is how can college students alleviate the debt they may have accumulated in a timely manner?

Does anyone have any success stories? i am thinking about living at home for awhile instead of getting another apartment after I graduate. so i can take care of some of these student loans


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The truly educated never graduate!

Just a note: you need to request a credit report from all three credit agencies because they are independent of each other and the credit reports could all be slightly different. For those who may not know, the three agencies are: Equifax, TransUnion, and Experian. You should try and request a credit report from each once a year.

Speaking from the trouble that I have found myself in with my credit cards, I think this should really be looked into legislatively.

I know that you must be eighteen to get a credit card and what not, but realisticly, when I got my first four credit cards, I was FRESH out of high school and was broke. I didn't have my mother right next to me to give me this and that and I was BROKE.

I was irresponsible, and I don't want to make any excuses for myself, but I think that it should not have been that easy for me to get four credit cards just like that.

And they know exactly what they are doing. They don't charge us any annual fees or processing fees and they set up these little pretty booths with t-shirts and cups and stuff. All you have to do is fill out a little form and prove your a college student and it's on. Then you get cards in the mail you didn't even ask for, and all kinds of stuff.

My credit is really not anywere near good right know, and I have cancelled my cards, which really makes themm not like you then, but I really wished that there could have been some kind of warning and it wasn't that easy.

But Like I said I was 18 and I though I was grown...lol. So I guess I deserved it.

But for a credit card company to set out and give credit cards to people when the blatantly state they have no job is really just to show how far they will go.

They let college students do that, because they know we have a long way to go in life and eventually they will get their money because we will want to buy houses and cars and what not. I jusdt think it is kind of wrong though that the schools allow this to happen

Great topic, SisterFriends!

Fortunately, my mom curtailed my credit card tendencies. I only had one card w/ a $500 limit; I was threatened with paying all my own expenses if I signed up for more cards. I was one of the lucky ones.

It is also interesting that someone mentioned college students and cars. My cousin was given a guaranteed car loan while in college with NO cosigner (and very little credit) simply based on her freshman year grades! Now what work/study-job-having college student needs a car note? Needless to say, her parents are still her main source of income today. Did I mention she graduated from college in 1990?


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MCCOYRED

Dynamic
Salient
Temperate

Mu Psi '86
BaltCo Alumnae

Well, my story is different. I did not have credit cards while in college. Mind you, I had a CLEAN, POLISHED credit history....NO CREDIT, BUT, someone did obtain a card IN MY NAME! http://www.greekchat.com/forums/ubb/eek.gif

I NEVER received ANY bills. I guess my SS# was obtained from a class roll, or some department and my identity was "stolen".

Anyway, one day, my mother called me and told me something about a card and the "bill" was being turned over to a collection agency. She KNEW I never came home with NEW items. Anything NEW I had, she had purchased them. Then the records showed that items had been purchased as far away as Chicago...HECK, I have NEVER been to Chicago! http://www.greekchat.com/forums/ubb/eek.gif

So, from there we tried to get to the bottom of it. By the time we found out what had happened, it was too late. The incident went on my credit report. I submitted a dispute and left it at that. The debt the person had incurred was over $1000. http://www.greekchat.com/forums/ubb/eek.gif So, that was in 92. Since then, I have little by little gotten my credit, back on track!

I HAVE NOT AND WILL NOT PAY FOR SOMETHING I DID NOT DO! Shoot, at least let me have some merchandise or something...YA KNOW!

I wish they would curtail or limit credit to college students.

Like you AKA2D '91, I have now and had throughout college outstanding credit history but I have had a couple of fraudulent accounts set up in my name and showing up on my credit reports probably for the same reasons you stated (i.e. people stealing SS# from class rolls, etc). I feel like I am an expert on this situation by now. Like I stated earlier, people, you must obtain a credit report from each of the three credit agencies once a year because the longer incorrect info is on your reports, the harder it is to dispute. Not only should you dispute it with the three credit agencies but obtain a fraud affidavit from the company that has a fraudulent account with your name. You can also put fraud alerts on your credit reports but you have to do this with all three agencies because as I stated earlier, they are independent of each other. Each credit agency will explain how their fraud alerts work. But anyway, thank God that I have been able to get these fraudulent accounts off of my credit reports.



[This message has been edited by DST Love (edited January 17, 2001).]

I have had to deal with the nasty credit demon as well. I come from a large family. I am the third child out of 10. We just did not have much. When I went to college, I could not believe that someone would give me not one but two credit cards. Can you imagine how it feels to go from having nothing to having a whole lot of somethings. Well, I had no discipline whatsoever. I bought clothes, things for my family etc...Even though it has been years since graduation, I am still battling with this demon. If anyone has any suggestions on credit repair, please advise.

There was an article about a girl suing the company that gave her credit cards. They knew that she was a freshman with no job. It messed her entire life up. She could not even get an apartment. Anyway, she won the law suit. I feel that maybe colleges should offer a class to all incoming freshmans regarding this situation.

Peace

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You are the master of your own destiny!

My name is OneSavvyDiva...and I admit...I too, am a credit-card victim! Sike, anyway, I also received a credit card my freshman year in college. Like one of the other sisterfriends said, I never received financial advice/example from my parents, and I maxed up my card within 3 months. I already had a car payment, cell phone, phone bill, and such...needless to say, I did horrible in school because I had to work so much to pay my bills. I ended up losing my scholarships, and grants, and I had to sit out of school because I couldn't pay my bills, let alone tuition! ANyway, my car is paid for now...I have gotten rid of the UNNECESSARY things I though I so desparately needed(except my cell), but I am still struggling with that credit card bill.

If anyone DOES have any suggestions on how to restore damaged credit, please let a sista know!!! I am SO glad I am going back to school this semester, I feel like I am a freshman again, new start! I just hope I can pull that GPA up...that's my first and FOREMOST priority right now.

I too am a victim of getting a credit card and being in some serious debt. Luckily, I have my mommy helping me out, but I'm still in debt. People will say that the person is to blame, but unfortunately for some people, credit cards are the only way they can pay for their college expenses. At my school we have a fundraiser that raises money for cancer, well how about a credit card company that basically lives on my campus decided that they would donate money to the cause every time a student opened a new account. The tactics that they use to get revenue is ridiculous.

My sophomore year I worked as a telemarketer at the company in which I had an account with. I worked there for a month and had to quit because of their practices. They thrive on student accounts. That's how they make their biggest and EASIEST sales. They get the students list from the school because they make a contract with the school in which they will make a "school credit card" and sell it to the students. When the students make purchases, the school gets a portion of the sales. I learned from working there that the companies make their money off of the outstanding debt. They had a board which contained the total of the company's outstanding debt from its customers and they would give prizes to it's employees if it reach a certain mark by the end of each quarter.

College students leave college with huge amounts of debt. It's hard for them to get a car, an apt, etc. Nowadays, companies are even looking in people's credit file and will turn them down for employment because of bad credit. With all this debt and the problems that follow, they can't begin their next phase of life.

After evaluating the whole situation, I believe that it should be a law restricting when a minor should get a credit card. The age limit should be 21. I don't understand how the government can say, one cannot drink until you are 21, but at 18 you are an adult and are responsible enough to handle "free money". The government is quick to limit how much financial aid you receive and has a fit when someone cannot repay the loans on time. If they thought about things better, they would know that it would be easier to pay off the loans if college grads didn't have to pay off their credit debt first.