Thesis Statement
Credit card companies should not be on college campuses marketing to students. Credit card debt is already spiralling out of control in the U.S. and with their parents already embroiled in heavy credit card debt, the credit companies are now keen to capture the next generation of consumers. In the course of this essay, I will discuss why I hold this opinion and attempt to persuade the reader to my view through a presentation of statistics and facts concerning credit card debt and their crippling effects.
Why Credit Card Companies Should Not Be On Campus Marketing To Students
At eighteen, having worked hard and graduated from High School, the vast majority of people go to college. Often, this is the first time that these young adults will be away from home; away from their parents, home-cooked meals and the comfort of financial dependence. In reality, while they may think of themselves as experienced people, well-equipped to handle whatever the world wants to throw at them and grown up; in reality, they are a lot more vulnerable than any of them really want to admit. However, students grow up quickly and many take on part-time jobs and balance their time between working, studying and socialising in order to make the most of their college experience (and to pay the bills). Imagine then, if you will, a student of this calibre, walking to class, when they are accosted by a credit card salesman, on campus, marketing credit cards to students. They are offered lots of credit with low-interest rates and it’s their passport to an easier life: it’s basically free money, right? Wrong. In the eyes of that student, that credit card means that they can worry less about money and focus on their studies and with the ‘guaranteed’ graduate wage that they’re bound to be on when they leave college, they can pay it off then, right? Wrong.
The average student leaves university with over $19,000 worth of student debt from loans and course fees alone, plus now the average student also leaves with $2,700 worth of credit card debt as well (Collegestudentcreditcard.com, 2011). So, even if they are one of the lucky few who leave college and walk into a well-paid job, they are already starting their adult lives with at least, on average, $22,000 worth of debt. That is before they have even considered buying a home, starting a family or even, for many, running a car. That is an appalling situation for our young people to be in, before even having had a chance to live.
The Recession
Everyone is aware of the world-wide recession which hit the U.S. hard in 2008. The ripples of effect are still being felt internationally and at home in America, as of February 2011, there was an estimated number of 13.7 million unemployed people. (BLS, 2004) According to one blog who base their information on figures from the Bureau of Labor Statistics: people aged between 20 and 29, are the worst hit for unemployment with the percentage leaping from 5% to 7.3% within a matter of months. As the blog points out, “it’s quite obvious that the Graduates of the USA are having a hard time getting jobs.” (Tech Cram, 2010) On top of this, the average credit card debt per home is $14,750 (Creditcard.com, 2011). In a nutshell, there are a lot of people who are out of work and struggling to find work (graduates included) and there are also a lot of people with vast amounts of credit card debt (without even considering mortgages, student loans and car loans). The situation is desperate and yet, credit card companies seem hell-bent on dragging fresh, young people into this mess.
Why Companies Target Students
It is extremely irritating when you go into your bank to make a simple transaction over the counter and find yourself being pestered by the clerk to talk about credit cards. They bandy about terms like ‘eligible’ and ‘entitled to’ and instantly, your ego swells up and you’re left thinking ‘wow, I must be really good with money so I could handle a credit card if needs be.’ Credit card companies and banks rely on this feeling to lure you into signing on the dotted line. It’s irrelevant if your current account has a zero balance; in fact, that probably goes in your favour because if you aren’t an effective financial manager, you are likely to incur charges for missed payments and the like, meaning that the credit card company make even more money out of you than do from simply crucifying you with interest rates.
This fact is largely the reason why students are prime targets for credit companies: they are impressionable, poor and most have an erratic income meaning that the chances of them being able to sensibly manage a credit card are so slim, that they are almost definitely going to get into trouble and debt. This is good news for credit card companies: a missed payment means a charge; going over your agreed credit limit means a charge; wanting to pay off the whole balance in one go means a charge (because they won’t be able to make money out of you in any other way). It is for these reasons that I refer you back to the purpose of this essay, which is to persuade you that: credit card companies should not be allowed to market towards students on college campuses.
How Companies Attract Students
Often, credit card companies (and banks) deliberately make a credit card extra-appealing to students by offering them fun extras for free if they take out an account with them. One bank in the UK offered a free railcard; others give vouchers to various high street stores; and Capital One are currently offering 24 hour roadside assistance (Capitalone.com). These are designed to attract young people to something which they should not be dabbling in until they are more financially viable. Much like the fuss made about ‘alco-pops’ and their cartoon-heaving, colourful branding which supposedly attracted children, credit card companies are adding bright, cheerful additions to their accounts to attract young people who are not yet ready to handle the responsibility of a credit card.
In conclusion, credit card companies should not be allowed to petition for new customers on college campuses simply because it is morally wrong: these are impressionable young minds, independently experiencing the world for the first time and as a nation, we should have laws in place that protect them from getting into financial difficulties before they have even graduated from college. It is simply not fair to expect an eighteen year old to responsibly manage a credit card with $1000 worth of credit. Students should, at least, be able to walk around campus without fear of being pounced upon whilst on their way to a class. Some may argue that it is a prime time for students to experience a steep learning curve, but I disagree: students are already learning and experiencing everything else for the first time in college and financial burden should not be one of those things.
References
1. Collegestudentcreditcard.com. (2011). College Student Debt Statistics. Retrieved from http://www.collegestudentcreditcard.com/articles6.html
2. Creditcards.com. (2011). Credit Card Statistics, Industry Facts, Debt Statistics. Retrieved from http://www.creditcards.com/credit-card-news/credit-card-industry-facts-personal-debt-statistics-1276.php
3. Bureau of Labor Statistics. (2011). Economic News Release. Retrieved from http://www.bls.gov/news.release/empsit.nr0.htm
4. Tech Cram. (2010). Graduate Unemployment Rate Is Increasing in USA [web log message]. Retrieved from http://techcram.blogspot.com/2008/12/graduate-unemployment-rate-is.html
5. Capitalone.com. (2011). Capital One Platinum Prestige Credit Card. Retrieved from http://www.capitalone.com/creditcards/platinum-prestige-credit-card/?linkid=WWW_1010_CARD_TGAFF01_Z_Z_01_T_CP71310EW
