Monday, October 20, 2008

The College Credit Card Trap

"The College Credit Card Trap." A couple of days ago, the New York Times had an editorial piece with that headline. The lead paragraph read thusly:

Add this to the list of the country’s financial woes: Credit card companies are aggressively targeting college students, many of whom are naive about money matters and vulnerable to predatory offers that can get them permanently mired in debt.

The lead did its job. I continued to read.

The opinion piece (link here) went on to describe an "eye-opening" survey that was conducted by United States Public Interest Research Group, or U.S. PIRG, an advocacy group. In the survey, the advocacy group detailed the lengths to which credit card companies will go to lure college students into applying for credit cards. Unfortunately, the New York Times did not provide a link to the survey.

Curious, I decided to find the survey on my own. I couldn't find anything called "the college credit card trap," but I did find a U.S. PIRG survey called "the campus credit card trap." But the publishing date was March 2008. Could this be the same survey? It turns out that it is.

Listen, I'm not complaining. I'll take my credit news wherever I can find it. But I would have appreciated this survey, and its results, a whole lot more if the New York Times had alerted me to it seven months ago. Indeed, had I not been inquisitive, I likely would have thought that the survey was more recent (no more than a month old). I'm now left to wonder: why is the New York Times only now bringing this survey to my attention? Must have been a slow news day or something. Nothing else can explain it.

Meanwhile, I am not pretending as though this survey is fresh. Instead, I'm highlighting the survey because it is chock-full of interesting information -- even if it is some seven months old. If you have the time, and didn't catch it back in March, you might want to give it a read. The full report can be read here (link here).

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Lynn said...

Been trying to get my 17 year old to read your postings. He will be attending collage in the fall. I think he is tired of me telling him NOT TO APPLY FOR CREDIT! He has a bank account, a pretty good job for a kid his age; and as of now is living in his means. The way I see it, college students are reading what in happening with credit today and the effects it is having on all of us. This report could be 3 years old, but the message/ lesson is still the same. Just my 2 cents! Great read!

azntg said...

I'm going to put my bets on a "Oh hell, while we're in a bad economy, why not?" thing. This sort of stuff would've never caught the attention of the public before all the banks and investment firms started to collapse like dominoes.

Forget the student credit card trap. What about the student loans trap? Even the basic college tuition is so expensive nowadays, many students have to take out obscene amounts of loans just to attend college (because tuition isn't the only expense we have to worry about and let's face it, in some schools, financial aid will barely scratch tuition). If they wanted to make sure to separate the commoner and the elite, they're sure doing that one right!

lupoman said...

Gotta love the mainstream media!

athensguy said...

Don't yell at him to not apply for credit. Tell him to get one or two cards and teach him how to budget. Otherwise, you're just delaying the credit problems until later.

My DW has about $40K in student loans, and she has a job that easily covers that. I suppose you have to pick your major wisely if you're going to have to take out loans for it.

Josh said...

athensguy, well said. You don't want to be taking out 200k+ in student loans to land your "dream job" paying 70,000 a year. said...

I'm with Athens. Indeed, one of my "related articles," which are just below the story, says just that. Young students should get cards.

But they should nurse them, using them only sparingly. They're a means to an end.

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