Credit cards a student debt trap

Is it possible for college students to manage credit cards and the payments that accompany those cards? Credit cards can be risky for anyone, but for college students the risk can be significantly greater.

Students are lured in with low interest rates and low monthly payments only to find that those rates and payment amounts do not last.

Every time a student signs an application for a credit card, they run the risk of lowering their credit score by almost three points, said Leslie Smith, eSystems Coordinator for Envision Credit Union.

“Applying for a credit card gives you what is called an inquiry, and those are possibly harmful to your credit score,” Smith said. Smith also states that students have to remember that credit cards have to be used responsibly. They also have to remember that they will be held accountable for every cent that is spent on that card.

Sam McCall, a Bank of America customer, recalled that when she was in college she signed the application for credit cards more than once. She was drawn to them because of the free gifts that the companies offered. In return for signing, she received free gifts and was offered low interest rates, so she took the cards. At the age of 36, McCall is still paying off credit card expenses and trying to raise her credit score so she can purchase her first home.

Edward Mason, a financial planner, believes that obtaining credit cards at a young age has its advantages. When used correctly, credit cards can actually help build credit for those who do not have any.

Mason believes that a person applying for a credit card should be advised by a financial planner before getting in too deep.

“Applying for credit cards means you are taking a huge risk and if you are not educated on the advantages and disadvantages, a person could make a very big mistake,” Mason said.

The Office of Student activities make it easy for credit card companies to tempt students-companies simply plan a date through the office. Company representatives stop by on that particular date, sign on the dotted line and are then free to scope out the campus looking for new “victims.”

When asked what her thoughts were about the credit card companies on campus, Smith replied, “I don’t think signing up for credit cards for a free T-shirt is the most intelligent thing a student can do, it seems wrong but it is legal.”

Smith also adds that some bank institutions offer classes to educated students on how to manage their finances for the present as well as the future.

For more information about financial planning you can contact Edward Kennedy Mason financial planning firm at:

Devon Hennessy is a fourth year public relations student from Crestview, Fla. She can be reached at