Last week I watched a clerk talk a college student into opening 
another account at the Bon Ton to save 15% on a clothes for college. A brief lesson in credit rating would have told that student ... who jumped at a delayed payment offer ... that every such account opened at that mall lowered her credit score. The clothes that look good today ... could lower credit scores and prevent her from getting a deal for a home or raise car later on. Will this same student also dump her college costs on her VISA? Apparently more and more higher education institutions allow students to charge their tuition fees. 
An interesting study tracks student use of credit cards at college, reported on CNN this morning. According to the Associated Press… “More than half of college students have at least one credit card that is billed to them, a new study says, and about a quarter of those students have used their cards to pay tuition.”
Some schools allow students to pay their tuition on credit cards and it looks as if that is driving up credit which is carried over from month to month.
Since we know that people act out of what they believe… we also know that there are lessons to be taught and learned about credit that can help college students. Have we made it too easy for them to become the interest victims that pad big business?
Financial literacy is often missing in college age students … likely because the language of finances seems to have been usurped by a few who can decode its jargon and doublespeak. Perhaps there should be a financial component that comes with the pre-college package to help students get the most from their years at higher education.
I’d also like to see a course that teaches students how to create a strong credit rating – since many have no idea of the importance of such a plan. Lack of knowledge keeps young borrowers vulnerable and in debt. With some firms clearly cashing in on this vulnerability… where is the incentive to teach financial literacy? What do you think?
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