Credit cards are everywhere, especially on campus. It’s impossible to miss the solicitors who promise students free T-shirts, school supplies or meals in exchange for a credit card. The convenience of the “buy now, pay later” mentality is popular with many college students. According to American Demographics magazine, 93 percent of 21-year-olds have at least one credit card. But why stop at one? The average 21-year-old has three.
The lure of credit cards traps students as well as adults. Most retail companies offer a certain percentage off your current purchase, simply for signing up. Others have popular offers like no interest and/or no spending limit for a certain amount of months.
Swiping plastic is easier than paying cash for most college students. Constant expenditures such as textbooks, clothing, gas and groceries make it too much of a hassle to use cash all of the time. Debit cards are just as useful as credit cards – if you have enough funds in your account to pay for whatever you are purchasing.
Every college student should have a credit card – provided they have a spending limit. The lower the limit, the less the person will spend, greatly decreasing the chance of debt accumulating. A recent survey estimates nearly 75 percent of college students use at least part of their student loans to pay credit card bills, which average to $3,000. It doesn’t help that credit cards are accepted forms of payment almost everywhere. Now even Big Macs can be charged when you go to McDonald’s.
But monthly interest and late fees keep students penniless and credit cards companies successful. Visa earned more than $1 trillion in sales last year. Visa.com’s student section contains a “balance budget” form, allowing you to insert your estimated income and expenses in order to calculate your discretionary income. All college students should use forms such as these; many don’t and that helped Visa earn that trillion.
We’ve all been in line behind the person who spends 10 minutes sorting through a stack of credit cards, debating which one to use on a particular purchase. When choosing which credit card to use becomes a process, you have too many. Only two years ago I was continually denied a credit card because I didn’t have any credit. Now that I have two, I continually get offers from various companies offering me their “new and improved” card – really the same old card with prettier colors.
Some believe that college students aren’t mature enough to handle credit cards and the debt that comes with them. The irony of credit cards is that they are necessary to buy a house, car or any big-ticket item – all of which are concerns for college students and recent graduates.
Besides banks, airlines and restaurants, eBay and even Donald Trump are among those who offer credit cards. The “Trump Rewards VISA” offers a 1 percent rebate on all purchases, and a 2 percent rebate on purchases at Trump casinos.
Don’t worry: The card does not feature a picture of Donald. The moral of the story is use credit cards as much as you want, but always remember that credit card companies profit off those without any profits.
Stephanie Young can be reached at firstname.lastname@example.org.