Congress recently passed a law making it harder for people under 21 to get credit cards, marking a new era for college students. People younger than 21 now need a parental co-signer or proof of steady income in order to get a credit card.
More young people are in credit card debt than ever before — 84 percent of college students have credit cards, and their average debt load is more than $3,000, according to a study by Sallie Mae. The amount of debt students carry has risen drastically since 2004. Seventy-six percent of college students say they’ve encountered credit card companies tabeling at their colleges, many of which offered cards in exchange for free T-shirts or slices of pizza.
The new legislation is intended to protect young consumers from the traps of credit card debt, but not everyone is convinced that making it more difficult for young people to attain credit cards is fair. Huffington Post columnist Jim Randel writes,
By delaying the issuance of credit cards to young adults, we are not helping them. In fact, we are making it harder for them to build up a credit history and favorable credit score. We are impinging on their ability to access the convenience of cards and we are tying them to their parents’ finances for periods beyond reason.
Are you a student? Do you have a credit card? How old were you when you got your first card? How did that work out for you? What will new regulations mean for you and your credit?
- Rob Blackwell: Washington bureau chief for American Banker
- Jobetta Hedelman: Graduated from the University of Oregon in 2008
- Nessa Feddis: Vice president of the American Bankers Association