Student Credit Cards: Useful or a Trap?

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HYI I NEED CREDIT CARD

VICENT of TX 10:38PM August 31, 2008

It isn't fair to single out college students as more likely to be in debt. It's just that they are able to substitute naiveté and ignorance for stupidity. Kids are not taught real-world finances in high school home ec. And they certainly can't learn delayed-gratification from their debt-ridden parents.
These kids will fool themselves just like everyone else, thinking they can handle the debt. They believe they will pay it off at the end of the month, or next year, when they get a summer job, or, in a few years, when they get a real job. Like everyone else, the college kids will see the monthly payment, but not make the calculation that shows it will take them years to get rid of the debt if they only pay the minimum.
There is one fundamental fact about human nature that liberals keep glossing over in their attempt to fix the world. PEOPLE ARE LAZY AND SELFISH. No matter how simple you make the terms and conditions, people will not read them because it will be another piece of paper they would have to be responsible for and they don't want to be responsible, they want to blame someone else.
Before my son went to college, he got a college credit card and we went over the entire terms and conditions. He read each paragraph and I interpreted. I also told him about the trap of convenience checks and 0% offers and universal default. But, as a parent, I know that education and nagging only goes so far. The rest is up to him.

JimmyDaGeek of MD 1:53PM July 02, 2008

Why does Congress think they need to intervene in everything? Can't people take responsibility for their actions?
One thing is certain. Get Congress involved and it will be more screwed up than ever before.

Don of TX 2:17PM July 01, 2008

And what about the millions collected by Cuomo from the supposed student loan "scandal"? When are we going to see that money put to good use in educating students? I work in the profession, and have not heard a word about it. I wonder how much interest he is earning on a daily basis?

Eating Raoul of CO 11:10AM July 01, 2008

So there are allegedly "highly lucrative" and "somewhat secret" agreements between credit card companies and colleges that allowed the companies to market on their campuses. Who cares? Assuming cards are going to be marketed on campus, I'd rather the school have an agreement with the card company to guarantee good terms for students than have card companies unregulated. And there's certainly nothing wrong with co-branding. The bottom line is how the terms of the deal that students are receiving stack up with what's available in the marketplace. I suspect in most cases the school insists on safeguards that protect students.
Cuomo was similarly misleading in his financial aid crusade. What he never acknowledged was that schools were negotiating excellent deals with lenders--significant attractive borrower benefits, pools of grant money for poor students, etc.--at attractive rates. Now you have none of that, and students are paying more for loans than they did before his crusade. And in trashing all student aid offices, he hurt the best and, yes, most unbiased source of financial aid information for students and their parents. Wonderful unintended consequences (assuming they were, indeed, unintended).
There's nothing wrong with transparency, in financial aid or credit cards. The more the better. But don't automatically equate lack of transparency with "under the table deals" that are not in the consumer's best interest. And don't let happen with credit cards what happened in financial aid, where Cuomo's crusade gathered him much publicity but ultimately hurt the students he was allegedly protecting.

Michael of MD 10:46AM July 01, 2008

They don't ruin lives if you don't use them. If you are in college you should already understand these things. There are more important things the Federal government should be dealing with.

Neil B. of MD 8:38AM July 01, 2008

There is a new site to help students with Credit Cards called Credit Card Zappers. They claim to be able to lower debt by knocking off interest and other fees.
It's amazing these credit cards are allowed to take advantage of people and ruin their lives. Someone in the government would step in if they cared, but too many people are getting bribed.

Joshua Rush of CA 6:47PM June 30, 2008

Good story on subcommittee work at its best, but we could have all just rented "it's a Wonderful LIfe" instead. Clearly Rep. Maloney was presiding over a dryer version of George Bailey vs. Mr. Potter.

Kathleen Reilly Mannix of DC 4:25PM June 30, 2008

I came close to using a convenience check to pay my rent, because I am experiencing the worst financial aid problems in the world. Basically the money I thought I had to pay rent isn't there...I only almost used it because I knew I would have the cash in hand to pay off the check when it posted to the account.
As for student credit cards, how are you supposed to build credit without one? Although my credit cards are not and have never been school branded, I will admit to caving and getting the Disney rewards Visa so that I could carry mickey mouse in my wallet. As for 0% the first x months, my offer was 0% the first 12 months but Chase tried to start charging interest after 6 months, until I overnighted the terms of my card agreement to them. Promotional interest periods work for those who intend to pay it off by the end of the period.

Veronica of NY 3:25PM June 30, 2008

These idiots in Congress don't realize that students, just like everyone else in this country, have one word in their arsenal that can go a long way to teaching financial responsibility. That word? NO. Say NO to people who offer credit cards, do NOT cash convenience checks which are an obvious ploy to get your business, do NOT believe the hype about 0% APR for the first 6 months, do NOT go online to apply for cards, do NOT apply unless you are absolutely certain you will only use the card for emergencies.
Take it from someone who couldn't say NO, and is now living with the consequences of having poor credit and having to delay spending. This wasn't because credit card companies were marketing to me, because they were. It was because when I got the applications, I applied for all of them, even though I knew I didn't need the credit and I didn't have the money to afford them.
Personal responsibility cannot, I repeat CANNOT, be legislated. The only thing Congress is going to do is meddle in things they don't understand, and make the markets even worse for those whom they intend to help.

Chris of AZ 2:06PM June 30, 2008