5 Steps To Lowering Student Credit Card Debt – College Students And Debt

college student credit card debt
by US Embassy New Zealand

5 Steps To Lowering Student Credit Card Debt – College Students And Debt

 

Any college student today will tell you that it’s hard just to get by financially each day time. Tuition for both private and public institutions are increasing. Books are more expensive. And, meanwhile, daily bills like food, gas and rent show no indicators of relenting.
 
One of the tools that college students have traditionally used for making day-to-day purchases in addition to for emergency purchases – has been the charge card. While a card can be a very convenient tool for university students, it can also enable them to go heavy into debt.
 
If you are interested in promoting financial responsibility among yourself or a college student that you experienced, here are 5 steps to lowering student greeting card debt. College students and debt do not need to go hand-in-hand:
 
1. Debt is on the rise among university students:
 
A recent Sallie Mae study proved that credit debt among college students is at all-time-high. Students with cards are now graduating with 1000s of dollars in card debt, on average. Part of the reason behind this is that, until recently, it has been exceedingly possible for college students to acquire credit cards.
 
2. New laws allow it to be harder for college students to qualify for charge cards:
 
Recent laws in the U. S. now make it harder for credit card issuers to market directly to college students. For instance, marketers for these companies are no longer in a position to physically come within a certain distance of campuses, plus they are not allowed to sign up anybody under age 21 for a card.
 
3. One alternative would be to go cash-only:
 
In light of these changes, some students now would rather go the cash-only route. This means that they no more use cards, opting instead to use cash or even cash equivalents, such as debit cards and inspections. The only weakness with this solution is which, without a credit card, the student has no backup fund in case an emergency purchase must be made.
 
4. Or, students can co-sign for a card having a parent:
 
An alternative to going cash-only is to co-sign with a parent or another adult for credit cards. The downside of this option is that the student still ends up with credit cards, like before the new law went into impact. The result is still mounting credit card financial debt, even with the adult co-signer.
 
5. Some students choose to use prepaid debit cards for day-to-day use:
 
A third option for the student is to go on and apply for a card, but to use it just for emergency situations. Then, for day-to-day use, the student can purchase and use a prepaid debit card. These cards require no application process because they don’t tie in with the student’s credit history by any means. Rather, you just purchase the debit card for a specific amount and then use it like a credit greeting card – wherever Visa, MasterCard and American Express tend to be accepted.
 
Credit card debt continues to be a significant problem for college students. By trying one of those alternative solutions, students (and their parents) can slow up the debt or avoid it altogether.

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