Students Get Too Much of a Charge from Cards Many in College Already Deep in Debt

Article excerpt

The optimism of youth has revealed itself in a survey of college students and their attitudes about credit card debt.

Three-quarters of undergraduates surveyed at the University of Florida last spring say they use at least one credit card, and of those footing the bill themselves, one in 10 had a balance exceeding $2,500.

In interviews with the students, researcher Lisa Jamba-Joyner found that many think they will erase the debt once they graduate and start working -- a premise that she and credit counselors say is dubious.

Her research, conducted for a master's thesis, indicates that of students paying their own bills, one in five had already missed at least one monthly payment.

And freshmen were as likely as seniors to own multiple credit cards and carry balances.

"It's almost like everyone is embracing this buy-now, pay-later philosophy," said Jamba-Joyner, now an academic adviser in the College of Education at the University of North Florida.

"They're used to a certain standard of living at home, and when they get to college, they don't want that disrupted."

Her research is based on a survey of 217 undergraduates attending the University of Florida full time. Of the students who paid their own bills, 38 percent carried monthly balances, Jamba-Joyner found. And women were most likely to owe more than $1,000.

Kayla Chanthavong can relate.

At 18, she entered college in California and began a cycle of making credit card purchases and paying small monthly amounts that eventually led to a $6,000 debt, she said.

Now, at 24, Chanthavong said she thinks more carefully before using the plastic. It took her years to whittle down her debt, she said, to about $1,500.

Throughout college, she used credit cards to pay for tuition, clothing and living expenses, she said. Now, as she prepares to graduate from UNF, Chanthavong said she transfers her balances when the low, introductory rates expire.

"When you're younger, it's clothes, whatever," she said. "Now, it's like, do I really need it?"

Her experience is seen in the profile of people seeking first-time help from credit counselors.

In Jacksonville, the Consumer Credit Counseling Service has not seen an increase in the number of college students seeking help, said Director Dawn Lockhart.

But the clients who come in for the first time, in their late 20s, typically have repayment problems resulting from the credit debt they began accumulating in college.

They come for help when they realize their salaries cannot erase the burden of debt, and when they see how that debt is affecting the lifestyle choices they can make, Lockhart said.

"You learn by experience," she said. ". . . A student just doesn't have that reference point."

Students today have been raised by parents who use credit cards, and generally carry balances. They see a revolving amount of credit debt as a normal state of affairs, Lockhart said.

And whereas, college students two decades ago were not targeted by credit card issuers, today even high school students are inundated with invitations to obtain credit, she said.

"We have provided the product to an age group that does not fully understand the ramifications of its usage," she said. …