COLLEGE STUDENTS AND CREDIT CARDS FACTS
Targeted for Credit Cards • College students who need to pay for educational needs—textbooks, tuition and transportation—are solicited several times a week on campus through flyers, on-line advertising and on-campus marketers.1 • • The credit card industry targets college students as valuable new customers. Students develop brand loyalty, so vendors compete to get their cards into students' wallets.2 Credit card companies also seek out college students because they are a particularly vulnerable population from which to extract high fees. For college cards, the starter rate hovers around 17% but it can quickly rocket up to 29%.3 Credit card companies on college campuses give out free trinkets—t-shirts with college logo, stuffed animal school mascots, candy, pizza, frisbees, travel mugs—to get college students to sign up for credit cards.4 Over 58% of college students said they saw credit-card marketers on campus for two or more days at the beginning of a semester.5
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Getting Credit Cards • 56% of all undergraduates surveyed by Nellie May reported obtaining their first credit card at the age of 18.6 • 83% of all undergraduates in 2001 had at least one credit card, with the average student carrying four credit cards at any one time.7
Carrying Credit Card Balances • Credit card balances among college student consumers shot up 134% in the last decade.8 • • • • • Three out of five students with credit cards maxed them out during their freshman year.9 71% of young adult cardholders do not pay off their balance in full each month.10 11% of college students make less than the minimum payment each month.11 The average balance on undergraduate credit cards is $2,169.12 College seniors are graduating with an average of nearly $4,000 in credit card debt.13
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“A Consumer’s Guide to Credit Cards.” Truth About Credit, U.S. PIRG Education Fund and the Student PIRGs (Public Interest Research Groups): 1. accessed 5 December 2007. 2 “The Campaign.” Truth About Credit, U.S. PIRG Education Fund and the Student PIRGs (Public Interest Research Groups). 3 Lisante, Joan E. “Plastic Peril: Credit Cards and Students.” ConsumerAffairs.com 15 May 2006. 4 “A Consumer’s Guide to Credit Cards.” Truth About Credit, U.S. PIRG Education Fund and the Student PIRGs (Public Interest Research Groups): 2. accessed 5 December 2007. 5 Migoya, David. “Getting carded at college: College freshmen are a ripe target for credit-card issuers, but inability to pay the bill can leave grads with bad credit.” Denver Post 23 August 2007. < http://www.denverpost.com/search/ci_6692541 > 6 “Credit Card Tips for College Students.” Consumers Union (September 2007). accessed 5 December 2007. 7 “Facts and Statistics.” Truth About Credit, U.S. PIRG Education Fund and the Student PIRGs (Public Interest Research Groups). 8 Ibid. 9 Singletary, Michelle. “Do College Students Need Credit Cards? Hardly.” Washington Post 28 August 2003: E03. 10 “Facts and Statistics.” Truth About Credit, U.S. PIRG Education Fund and the Student PIRGs (Public Interest Research Groups). http://www.truthaboutcredit.org/facts 11 “Consumers Union Offers New Guide for College Students Signing Up For Their First Credit Card.” Consumers Union 19 September 2007 press release. accessed 7 December 2007. 12 “Credit Card Tips for College Students.” Consumers Union (September 2007). accessed 5 December 2007. 13 “Facts and Statistics.” Truth About Credit, U.S. PIRG Education Fund and the Student PIRGs (Public Interest Research Groups). http://www.truthaboutcredit.org/facts