Credit Cards: The Potential Dangers.
Credit card debt is a major problem for some college students because it can easily get out of control. If a student obtains $5,000 in debt on his or her credit card carrying the average rate of eighteen percent interest and that student only makes the monthly minimum payment of $100, it would take eight years and cost nearly $10,000 to pay that card off. For many students, the lure to "buy now, pay later" can be very tempting. But there are dangers lurking behind this mentality. College students should be careful with credit cards because it is easy to get into debt that can last a long time; furthermore, college students who have been informed about credit card management should be able to handle one. .
Not only is it risky for college students to have credit cards, it is very easy for students to obtain one which causes a risky combination. According to a survey, sixty-seven percent of college students have at least one credit card and eighty-five percent of those are in their own name ("Survey" 1). Credit card companies usually target college students because as students grow and their incomes become larger, they will become great customers. Under regular criteria many students, with little to no credit history, would not be able to get a credit card, but companies realize their potential to make money and target them anyway. Credit card companies frequently set up booths on or near campuses. .
The students" lack of financial experience or education leads many students to serious debt. Few school systems incorporate financial education into their basic curriculums. As a result, students enter the real world with little knowledge of personal finance. Truth About Credit, an organization devoted to educating students about financial matters, administered a test about credit and other money management techniques to 1,500 high school seniors.
