Information About College Students and Credit Cards

In 2001, The General Accounting Office of the United States (GAO) released a major study of the habits of credit card use by college students. This study was released in response to a request from Congress asking for more information on this subject in order to discern whether new legislation would be necessary. 

Some of the findings of the GAO include:

• 64% of college students have at least one credit card.

• 37% of these credit cards were acquired by mail, either through direct marketing campaigns or through fliers used by campus book stores or other solicitors.

• 24% acquired their cards through an on campus display or through some kind of personal solicitation. These vendors are often present on orientation or enrollment days, and they often pursue students aggressively to get them to apply for cards.

• 25% acquired their cards before they ever went to college, either as working adults, as high school seniors, or because they were provided by parents.

• 55% acquired their credit cards in their freshman year of college, leaving only 20% who may have acquired their card or cards later in their college career.

• 59% report that they pay their balance in full every month.

• About 15% admit to carrying a balance greater than $1000 from month to month.

• Students who were responsible for paying their own credit card balances, who then obtained such cards from campus tables, had nearly three times more cards than those whose parents shared responsibility for the cards (2.6:1).

• More students in the above category–responsible for their own cards—carried balances of over $1000 than those who weren’t.

• 15% of students held full-time jobs when they applied for their cards.

Of course, these studies used by the GAO have some caveats and limitations. For example, they rely on self-reporting by students, and do not attempt to verify that reported information. It is possible that students exaggerated the frequency with which they paid their monthly balance in order to make themselves look more responsible. It’s also possible that students simply did not remember accurately what their balance was or when they last paid it. However, the GAO relies on the reported data since it comes from the students themselves, who are considered to be the best judges of their own experience.