Tag Archives: Colleges & Universty

5 Consumer Protection Tips for College Students: College “Credit” Takes on a Whole New Meaning

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It’s no secret that college student have long been the target of credit card companies. Pre-approved credit cards and “you deserve it” enticements worked for these companies for years. The Credit Card Accountability, Responsibility and Disclosure Act of 2009 held some intended consumer protections for college students.

The Credit CARD Act Basics:

It’s a myth that the CARD Act restricted credit card companies from marketing their wares to college students on campus. Many students and parents alike may not realize that this is big business not just for issuers but for colleges and universities as well. Colleges have long received payments for the opportunity to market to students and even alumnus list.

There were “suggestions” and “restrictions” that simply involved notify colleges about marketing near campuses in the Act related to protecting college students. Companies could no longer offer “tangibles” better known as “freebies” to students who sign up for a card. Some people mistakenly believed this act issuers off of college campuses. That’s not true. They can be there, culling for those students who are over 21, have a steady income or a co-signer, they just can’t offer anyone a free t-shirt or pizza.

Beverly Blair Herzog of Credit.com writes, “I’m actually in favor of college students learning how to use credit cards under the guidance of a responsible adult. I just don’t want a stranger on a campus giving my kid gifts in exchange for signing on the dotted line.”

Those responsible adults Herzog refers to do come in to play with the Credit CARD Act because issuers are no longer able to give cards to applicants under 21 that don’t have a proven income to pay the charges without a co-signer. In most cases, that means the parents. While math courses abound on college campuses, in many cases it’s left to dear old mom and dad to teach Credit Smarts 101.

Here are 5 Consumer Protection Tips to Teach Your College Student:

Beverly Blair Herzog, a finance writer once who was once wooed into debt by credit offers, offers the first two.

1. “Think Twice Before You Sign: When you spend a little more money than you have, you end up carrying an outstanding balance. And the companies charge you interest on that balance, over and over again, every month.”

2. Herzog also says, “Don’t Charge Tuition: In a 2009 Sallie Mae study, 30 percent of students were using credit to pay for tuition, which is a very expensive way to pay for college. If your family is tempted to use this option to finance college costs, CPAs urge you to research much less expensive student loan opportunities.”

Some more sage advice for all ages that needs to reach college students.

3. Balance your checkbook. It seems obvious from Civics 101 but research has shown that over a third of college students rarely balance their statements and or checking account balances. This is an important life skill every college student needs to make a habit now.

4. Create a budget. Students can be so creative but when it comes to creating a budget they just don’t have a lot of real life experience. College students, and parents who are footing the bill should be able to tell what money is going to the bookstore and what money is going to the bar.

5. Don’t throw your credit in the trash.

Whether or not a student has credit card, issuers will still be sending offer letters. While the Credit CARD Act may have deterred marketing strategies on campus, direct marketing, like life, still happens. A bird in hand may be worth two in the bush but a credit card application or worse those blank checks from the credit card companies can be like a fat cat to identity thieves, hackers and credit needy scammers.

How credit smart is your college student? Do you have tips to share with other parents or college students?

Living on a College Campus

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One of the first questions that comes up after cost and location on any college search is where will I live? About 80% of four-year colleges offer some type of on campus housing. Many colleges strongly suggest (some may even require) that you live on campus for the first year. And other rules may apply too, like whether you can have a vehicle your first year. Always check for any special requirements for first year students.

Since you will be spending a lot of time in your college dorm room, you should do an onsite visit if at all possible. Many times photos are old and outdated and don’t reflect current conditions. It’s important to know how much space and what furniture and storage items may be included in your dorm room. It’s also a good idea to talk to actual students if you visit. You can find out more in 10 minutes talking to students than you can find in any brochure.

Why would a college want you to live on campus? Well, some would say it’s more money for the college and I’m sure many can use all the funding they can get. But in reality it’s been known for a long time that when you live on campus your first year you have a much easier time adapting and actually graduating.

The main reason is that you are in a better position to meet more peers and make new friends faster. Support systems are set up and you also have plenty of people to help with making the transition to college life. Everyone is in the same boat and for once peer pressure can be a good thing.

A big part of college is the social life, whether that means finding people with common interest or maybe your potential mate for life. You are also exposed to a diverse group of people that can expand your thinking in many ways. Another good thing about college is exposing you to information and culture different from your own.

Of course there are some downsides to dorm living. You need to learn how to get along, share things like bathrooms, common areas, and other resources. Privacy is difficult to find, roommates may not be a perfect match, and distractions are everywhere. But for most new students, the good things outweigh the bad in the long run.

On campus living can come in many shapes and sizes. Each school may have slightly different facilities but all fall into some general categories. And all have rules; in fact each type of dorm may have different rules due to the nature of the dorm. Some colleges cater to certain groups like international students and make special facilities and rules to fit.

Some common dorm types are single sex (male or female only), coed dorms (where both sexes may be allowed in many configurations), dorms for special needs students (more wheel chair friendly), and even type of majors (like all music or engineering majors), lifestyle (drinking, smoking, whatever), and student level (freshman, sophomore or above).

Dorm rooms come in all shapes and configurations. The two roommate models are the most common. But you also have single occupant, quad occupants, and everything in between. Cost is a factor in many of the layouts with the single being the most expensive. Bathrooms are almost always shared either between two or maybe even the whole floor.

Speaking of cost, each school can vary widely in cost. On the high end it can be around $6,000 per semester, on the low end it can be around $2600 per semester. Single occupant dorm rooms are the most expensive and the cost goes down with the number of occupants in the room. The age and special features of each dorm facility can have an impact on the cost too.

A big part of your first year of college is directly related to where you live. Don’t forget to check out any requirements and what facilities are available. If possible, try and visit the campus while school is in session. Take a look at the dorm rooms, talk to students, and get a feel for where you will be living.