'Will that be paper or plastic?'

'Will that be paper or plastic?'
Georgia Tech students and the responsibility of credit cards

By Allison Roberts
Campus Life Editor
ATLANTA
November 6, 1998

According to a recent government study, the average American carries nine to eleven credit cards. Georgia Tech students are no exception. College students are often targeted as potential clients for banks, and many students find themselves having financial problems before graduation.

The average household in the United States pays over $1,000 a year in interest on credit cards, and the average college student, according to a U.S. Public Interest Research Group (USPIRG), takes six years to pay off a $1,000 credit card debt. The USPIRG estimates that two-thirds of college students obtain credit cards from tables located in "hot spots" on campus, such as the Student Center and the Bookstore. These same students, on average, will graduate from college with debts over $20,000, including student loans.

Rebecca Rieck, a Tech senior and self-confessed "shopaholic," admits, "I love using my credit cards, but I spend money and forget about it until I get the bill. It doesn't even seem like I'm doing any damage."

One of the most well known (and widely used) credit cards, MasterCard, offers information for college students on its Web page, www.mastercard.com. MasterCard reminds students that "negative information can remain on your credit report for up to seven years."

MasterCard offers advice and information, along with an on-line credit card application (for students who do not already have credit cards) on the Web site.

Georgia Tech generally makes contracts with five or six marketing companies who target college students and offer credit cards. In the past, these companies have followed strict rules concerning advertising to Tech students, although there have been questions about continuing to allow these companies on campus.

Two companies with contracts at Georgia Tech, On-Campus Marketing, and College Credit Card, refused to answer specific questions about credit cards issued to Georgia Tech students. An On-Campus Marketing employee explains, "The [banks] only issue students $500 or so. Most students complain about that amount-it's not enough."

Some Georgia Tech students do not see a problem with the amount of credit offered to college students. When asked about her credit cards, one ME senior answered, "I have good credit, but no [regular] income. One national bank even offered me a $30,000 car loan, even though I didn't ask for it!"

Another student, who wished to remain anonymous, said that he has reached the maximum credit limit on three credit cards. He received two of these credit cards after applying at tables set outside Bookstore. "I only applied [for the cards] to get free T-shirts, and now I can barely afford the minimum payments on the cards."

For students with existing debts, there is hope-several credit companies offer advice to students (and non-students). For students with several credit cards, the best option is to eliminate unnecessary credit cards.

To eliminate a credit card (or two) the best option is to cut up (or destroy) the credit card with the highest interest rate, the one which offers no grace period, or any card which adds late payment fees, inactivity fees, or fees for not carrying a balance. Destroying the card will not eliminate the existing balance, but, the card cannot be used to create a larger balance.

There is an incentive for those willing to part with one credit card and begin repairing a bad credit record. The Consumer Federation of America is offering anyone who sends a cut-up credit card with a self-addressed, stamped envelope a guide to managing debts, and a surprise gift (if received by November 10). Cut the card into two halves and mail it to CFA, P.O. Box 12099, Washington DC 20005-0999. Students with financial problems can also call the National Foundation for Consumer Credit at 1-800-388-2227 for information about credit counseling services.

Copyright © 1998 by Gregory S. Scherrer, Editor and by the Student Publications Board

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