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College Students and Credit Card Debt

In addition to the stresses of study, many college students are facing significant monetary pressures as a result of tactics used by credit card companies to get teenagers to sign up for cards. In a recent poll, 80 percent of students reported receiving applications for credit cards, with many of them also getting phone calls and being asked in person to apply for a card in exchange for perks like pizza, t-shirts and other freebies.

It isn't difficult to lure a naive college student into taking on a card, but these young adults often have no idea how to handle the budgeting responsibility that comes with having a credit card. As a result, many of them rack up thousands of dollars in debt by the time they leave school, and that's in addition to the school loans that they will need to pay back upon graduation.

Debt consolidation companies can help these students to find credit card debt relief, but starting out life with this kind of financial burden is never ideal. Some students have become so overwhelmed by snowballing debt that they chose to take their own lives. To help curb this disturbing trend, the Senate and House are debating bills that will limit the ability of credit card companies to target college students.

On the other hand, some feel that learning how to use a credit card is a valuable skill that should be a part of a student's college experience. However, students too often start using credit cards without knowing what they are doing. Building a good credit rating in college can be very beneficial, but to do this, a student needs to be very careful about purchases.

Because a credit card feels like free money, many students make meaningless purchases and then find themselves unable to pay when the time comes. Even paying the minimum balance on a credit card can lead to extensive interest fees. Students need to learn only to use credit cards for important purchases and to cut down on pointless spending. Using cards for purchases and paying back the money promptly helps students to build a good credit rating, which will be important if they try to get a car or buy a house later. However, the key is to use the card in moderation and limit its use to items that are truly needed. That way, they won't need the intervention of debt consolidation companies fresh out of college.

While debates continue as to the degree to which debt consolidation companies should be allowed to market to students who are just finding their footing at college, students who got sucked into paying for items they really couldn't afford are increasingly in need of credit card debt relief. Whether or not these companies retain their strong presence on college campuses, freshmen could benefit from a course detailing the proper way in which to use a credit card.

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