Responsible Solicitations for Student Credit Cards
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by: barrywaters
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Word Count: 459
When students begin their studies at a university, they are quickly greeted by give away and rewards if they apply for student credit cards. Companies pushing incentives to sign up for student credit cards have been allowed to station themselves in student unions and on outdoor quads for years. Students are an easy target. Most of them are discovering a new sense of autonomy, as they take charge of their daily lives. For some, student credit cards offer the promise of instant gratification and new spending power. Many state legislatures and college administrators, however, feel that credit card companies are taking advantage of students at a time when many are very naive about financial obligations and do not yet understand the long term consequences of debt. For example, solicitations for student credit cards on the grounds at Rutgers are no longer allowed. Some universities are considering less drastic measures to reign in behaviors that push student credit cards, as state lawmakers discuss ways to help them do that. Legislatures in four states have already established bills to tamper some company practices around student credit cards on campuses in their states. The New Jersey legislature recently began its efforts to dampen aggressive practices around student credit cards, as well. Lawmakers announced a bill that would make it mandatory for banks to offer financial seminars and programs before any student credit cards could be distributed to new applicants. Those financial courses would give new applicants background on what various rates and fees actually mean, what happens when balances are not paid, how debt is accrued and how debt and delinquencies affect credit history. The law will target incentives and give aways, as well. New Jersey legislators, like those of the states that preceded them, are hoping to prevent bad credit habits in the students on their campuses. They want the students at its universities to understand the responsibility they take on when they open a credit card account.
The state of the current economy has left many consumers reevaluating their spending habits and credit behaviors. The free wheeling days of easy credit and a housing market that kept going up lured many into thinking they would not have to be responsible for their own credit habits. As a result, some are now reworking their budgets and striving to eliminate credit card debt. The efforts of many state legislatures and university administrations to tame the marketing of student credit cards aim to prevent students from falling into the trap that so many consumers have fallen into. By providing protection for vulnerable and financially green students on campuses, perhaps it will help build a foundation for responsible consumer spending.
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Related to the topic of student credit cards, stop in at www.getsmart.com/credit-cards.
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