College Kids Credit Card Statistics
It is no secret that college students generally have major credit card issues
. This is usually a result of the enticing offers that many college students may encounter during their college years. While it is understandable why many college students turn to credit cards, there is obviously a trend of mismanaging their newly found line of credit. The problem begins when the student loses track of why he or she originally obtained a credit card.Some students may use financial aid to help make tuition payments. However, there are times when this amount may not be approved and the credit card becomes the only option. Hence the student uses the card to make his or tuition payment. The problem, however, arises when the student decides to pay more than he or she can really afford. Some students go on to use credit cards for miscellaneous expenses, to pay for rent on apartments and buy text books. Soon the vicious cycle of uncontrolled spending takes hold of the student, sometimes forcing him or her to take out more credit cards to supplement a comfortable lifestyle. This uncontrolled spending has backfired many times as it is said that 1 in 5 filings for bankruptcy is attributed to a college student.
One of the major problems many college students face is that they may only be able to make the minimum payments required or quite often cannot really make payments. Yet the spending does not cease.
In a recent study released by Sallie Mae, it confirmed some very troubling findings about college students and their line of credit.
* 84% of undergraduates had at least one credit card which is an increase from 76%.
* Half of all college students had four or more credit cards.
* The average balance on students' credit cards is $3173.
* As much as 39% of students enter campuses with a major credit card which is an increase from 23% recorded during the 2004 period.
* As of 2008 only 15% of students maintained a 0 balance which is a significant decrease from the 69% that were seen in 2004.
* On average seniors now graduate with a $4,100 credit debt up from $2,900 seen about four years ago.
* 92% of students charge text books and other types of educational expenses using their credit card which is an increase from 85% during the last study period in 2004.
* Sixty percent of students were shocked when they realized how indebted they were, while 40 percent admitted knowing that they had no true means of paying off the debt before obtaining the credit card.
College students should turn to scholarships and low-interest financial aid first, only using credit cards as a last resort to bridge the gap.
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