Average Student Credit Card Debt
College Students Increasingly In Debt
The average amount of credit card debt for college students is a little less than $3,200.00 which is about 46% higher than it was in 2004. This is cause for concern among many, including some college officials who fear students may be getting themselves in serious financial difficulty. However, carrying credit card debt by college students is what the Bard called “much ado about nothing” unless at least three factors are also present.
Three Warning Signs of Student Debt
First, such students are paying the minimum balance due or less each month. This is a general indication of financial distress. However, for college students it may not be a problem at all since some students might be waiting for the arrival of their financial aid to pay a substantial portion of their credit cards balances. Thus, students might charge their tuition, books and supplies, and room and board to their credit cards then pay these balances off when their financial aid monies arrive.
Secondly, students are carrying balances of more than 50% of their credit limits on their cards. This is also a common sign of financial distress. But as noted above, there may be times when this is not a sign of trouble for some college students so parents should not be overly concern with the numbers without checking further with their children.
Third, and this is a critical factor which demands immediate attention and action, both factors above are present and you are getting bills from the university your child attends. Something has gone terribly wrong and your child needs parental intervention. You need to know where the money is being spent and to make sure it is not for illegal or immoral purposes. Further, your child is still learning so you might as well add financial responsibility and management to the curriculum.
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