The Facts and Myths of Student Credit Card Debt

The Facts and Myths of Student Credit Card Debt
Think you know everything there is to know about student
credit card debt? You might be surprised. This particular
credit card topic is a hot one and the myths run wild.
Let's see how much you really know about the world of
student credit card debt with these true or false
statements...

True or False: Parents Are Responsible for Their Child's
Credit Card Debt

False! Mom and dad don't have to foot the bill. If a
student is over the age of 18 and it's their own credit
card they are using, mom and dad are out of the picture
entirely. Mom and dad don't have to pay a penny towards the
debt. On the other hand, if mom or dad co-sign for the
card, it's an entirely different story. Then they have to
foot the bill or put their own credit rating at risk.

True or False: The Average Student Credit Card Debt is
Minimal

False! Undergraduates have an average outstanding credit
card debt of more than $2,000. That's not counting student
loans or other debts. Considering most college students
work part time (if they work at all) that's quite a hefty
figure.

True or False: Student Credit Cards Have Higher Interest
Rates

True. Student credit cards do have higher interest rates
than those intended for people with good credit. It's not
uncommon for students to pay an interest rate of 16 or 17
percent, whereas consumers with good credit can often find
fixed rates of 10 percent or less.

True or False: Student Credit Card Debt Accumulates From
"Frivolous" Charges

False! Forget the stereotype about students charging up
their cards with kegs and pizza. The average student
charges things like groceries, gas and other necessary
living expenses. If a student can't manage a job and
educational demands at the same time, they tend to use
credit rather than income to pay for their living expenses.

True or False: There Are More Students Without Credit Cards
Than There Are With Them

False! If you think the number of students with credit
cards outnumbers the number of students without them,
you're sorely mistaken. The majority of college attendees
are getting themselves into student credit card debt as we
speak. Just how many are there? It's estimated that more
than 75 percent of undergrads currently hold at least one
student credit card.

So there you have it - the truth, the whole truth and
nothing but the truth. Student credit cards are in
abundance, available at every turn. The key is in educating
students about the truths of student credit card debt, and
how to avoid the pitfalls.

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