The Art of Credit: The need for education

Credit cards offer the advantage of “buy now, pay later”. Students are lured into huge cash purchases made on credit cards based upon the false notion that it’s like free money and they run up debts that they spend a lifetime paying off. A recent analysis of student credit card debts from Nellie Mae revealed that 83% of all students have at least one credit card and about 47% have more than four (O’Malley). Median monthly student credit card debt ranges from $1200 to $1900 and according to a nationwide survey, the average undergraduate student loan debt is $18,900(Nellie Mae). The lack of financial know-how is proving to be a liability for students in effective management of their finances. Most parents do not take the time to educate their children about personal finance, and how to minimize expenses(Three step credit card education program).According to a survey conducted by PIRG (1998), most credit card companies target students in order to benefit from their lack of financial wherewithal. Therefore, it would be beneficial to educate students about personal finances and the proper use of credit cards. Education is vital in order to help students manage their finances more responsibly.
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