Consumer Payment Card News

Collegiate Debt

A new survey on student loans has found that 11% of college students using cards to finance their education had credit card balances exceeding $5,000 when they left school. However, the percentage who reported using credit cards for part of their cost of undergraduate education has not increased from the 27% reported 5 years ago. Those who used credit cards to pay for part of their education reported a median credit card balance of $3,400 at the time they left school, compared to a median balance of $1,600 for all students with a credit card. The “2002 Nellie Mae National Student Loan Survey” found the median credit card balance for all respondents was about $1,000. Nearly 40% of the group using cards to finance their education had credit card balances exceeding $5,000 when they left school. Although levels of credit card balances and levels of education debt are not correlated, those who reported using credit cards for undergraduate educational expenses have average undergraduate debt of $21,200, compared to average debt of $17,700 for those who did not rely on credit cards. The Nellie Mae survey also discovered that 18% of borrowers said they did not have a credit card when they left school.

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