College Credit Card Debt Is Up

College debt used to be all about student loans, and the only debt you had after you graduated had a positive effect on your credit score if you stayed on track with payments. Now more students than ever are entering college or going through college with credit card debt as well. Increases in tuition, textbooks, supplies and room and board are causing college students to pull out their credit cards to make purchases.

Student loan debt is very common for anyone that’s gone to college. On average between 50%-70% of students entering a 4 year college or university take out student loans and the average debt left over after graduation is over $20,000. With student loan totals across the country reaching $1 Billion, more and more students are getting into debt they can’t get out of. Once we take into consideration the increase in cost of living, tuition and supplies it is apparent why more and more students are signing up for credit cards to help them survive. The average college credit card debt after graduation is $4,138, says a poll done by USA Today.

One of the reasons students overspend on credit cards is because credit card companies make them so available on campus. The first week of school, campuses are filled with banks and card companies offering “great student rates” as well as giving away college memorabilia. The allure of student to student marketing and the sense of adulthood that comes with having a credit card get many students to sign up without reading the fine print.

If you have kids going to college or are in college yourself, it is important know about credit cards, what to look for if they want to sign up and good spending habits so they can avoid more debt when they graduate. It is also important for students to understand how getting behind on credit card debt can ruin their credit score before they even have a chance to use it. There are strategies for students and parents to learn that will help with college credit card debt, such as finding roommates to share the cost of living, looking at alternate housing that may be cheaper than the dorm rooms, food plans and, of course, establish good spending habits.

Having debt isn’t something students have to face alone. With the right help, habits and education, students have a great shot at starting adult life managing their debt or even without it. It is important to understand the resources that are available if you’re a student to live a healthy financial life.

Contact FCS today to learn more about getting rid of college credit card debt!