Saturday, December 7, 2013
What, if anything, could be the harm in filling out a quick application for a credit card that I would cancel as soon as I got it in the mail, and the payoff was a pair of Oakleys?
As far as freshman mistakes go, this was not the worst, but that one credit card I did accept and abuse turned out to have the most lasting effect. You could see that from the asteroid crater that was my credit score.
For four years of college, I took in more credit card offers than letters from family and friends. Even after graduation, that trend continues.
Next to student loans and textbook prices, there is no greater evil to college students than the temptation of credit cards.
The lure of instant prizes, the idea of free money and the promise of a parachute in case of emergencies? It's all hard to resist at a time when you're one step removed from being destitute.
A new report from the U.S. Public Interest Research Group says credit card companies have the upper hand on college campuses.
According to the survey, almost two in three students have at least one credit card. At least 76 percent of students said they stopped at tables on campus to look at credit card offers, often with the lure of free gifts like T-shirts, mugs, food or mini sports toys.
Eighty percent of students said they receive mail from credit card companies, at an average rate of almost five offers a month.
So on top of worrying about passing grades, paying back the government and keeping up with book prices, students have to fend off the credit man.
At a time when the economy is already heading south and overdue credit payments have hit a 15-year high, college campuses still look like ATMs to credit card companies.
Emily Fehrenbacher, a campus organizer for Maine PIRG, said the report puts into writing what students have known for many years.
''It just gives the statistics showing that for students, college debt is rising as well,'' she said.
Fehrenbacher worked with students at the University of Southern Maine and the University of Maine to help conduct the survey.
Credit card companies know the economy is in bad shape, but they also know students are a segment of the population that is always strapped for cash, she said.
Some students sign up for the cards planning not to use them, or just to tap them for emergencies. That doesn't always work out.
''But then textbooks are too expensive, tuition goes up or they have no spending money,'' she said.
Students at USM may have a slight upper hand over the credit card companies. The university does offer credit counseling as part of orientation through the Office of Early Success.
And while credit cards have access to the USM campus, it can be tricky, said Chris O'Connor, assistant dean in the student involvement and activities center. Outside groups with a commercial interest are only allowed on campus at specific times of the year, such as the opening week of school.
Groups also pay on a sliding scale to put a table on campus, with students paying nothing and credit card companies paying between $35 and $40.
But just like any good hustle, once the card companies have you, you're hooked.
The survey said that while freshmen with cards carried an average debt of $1,301, seniors doubled that with a debt of $2,623.
Eric Favreau, a sophomore at USM, said he's always been careful with his credit card, but he can see how the problem starts. Use it here or there, some groceries or gas, and things change.
''You think you can just keep going and all of a sudden it builds up on you pretty quick,'' he said.
The funny thing is, in an atmosphere saturated with education, students still need to learn more about how to handle credit.
Though the basic idea of money -- pay off debt -- is clear, you also have to think about credit score and how your history might affect things like future car loans or home loans, he said.
''I don't think students necessarily know it can come back and nip them,'' he said.
At a time when the economy is so bad that investment banks are given a hand by the government and Congress is looking for ways to stop the hemorrhaging in the housing market, what about the tactics of credit card companies?
I'm not an economist (in fact, I got a passing C in Econ 101), but I'm fairly certain that my credit would have been better and I would have been able to put more money back into the economy if someone had steered me away from the credit cards earlier.
If the young people are the future, what does it say when they're already in the middle of their own credit crisis?
Staff Writer Justin Ellis can be contacted at 791-6380 See his blog at:
www.pressherald.comAt a time when the economy is so bad that investment banks are given a hand by the government and Congress is looking for ways to stop the hemorrhaging in the housing market, what about the tactics of credit card companies?