In a recent article in Time Magazine, “College Students Are Credit Card Dunces,” it was reported that college students really don’t know much about the credit cards they have. In fact, while 70% of undergrads and 96% of graduate students have credit cards, fewer than 10% pay their balance in full every month. Moreover, only 15% know what interest rate they are paying on their balance, and fewer than one in 10 students know the late fee and over-limit fee amounts.
In addition, as pointed out in the USA Today article “Tips for college students on credit card use,” credit card use by college students can have a major impact on their credit score – and as you know from Chapter 6 of Personal Finance, Turning Money into Wealth, your credit score has all kinds of financial impacts. In fact, little things can have a major impact on your credit score.
Class Assignment and Discussion:
- Read through the USA Today article “Tips for college students on credit card use.” What tips did you learn about using your credit card and how it might impact your credit score? Have you ever made mistakes like these?
- If you have a credit card, what do you pay on your credit balance? What interest rate are you paying on it? What is your late fee? And what is your over-limit fee? Be prepared to share this with your class.
- Consumers Union has some “Credit Card Tips for College Students.” After look at those tips, what stood out to you as something you might not have thought of? Be prepared to discuss your answer in class.