Washington, DC (PRWEB) August 22, 2013
While parent’s mail boxes are filling with credit card bills from summer vacations and back-to-school shopping, their college-aged child is likely receiving offers for credit cards of their own.
Due to the Credit Card Accountability, Responsibility and Disclosure Act of 2009 (CARD Act), young adults under the age of 21 applying for credit now must demonstrate the ability to pay or have a co-signer in order to be approved. Thus, the 21-year-old college student has replaced the entering freshman as the likely target for credit card marketing.
“Building a positive credit history while in college can certainly help the young professional move on with his or her post-graduation life,” said Gail Cunningham, spokesperson for the National Foundation for Credit Counseling (NFCC). “On the flip side, abusing credit can work against a person when trying to land a job, lease an apartment or buy a vehicle.”
The NFCC’s 2013 Financial Literacy Survey found that 33 percent of respondents indicated they learned the most about personal finance at home. Although at first glance this can appear as positive, problems often arise if the parents have poor financial habits which the children observe and subsequently carry into their own financial lives.
Further, the survey revealed that only five percent attributed their personal finance knowledge to what they learned at school. This number is not surprising, as many states do not include a personal finance course as a requirement for graduation from high school.
Stepping into the world of credit without adequate personal finance training is asking for trouble, as responsibly managing credit is critical to building a solid financial future. The NFCC recommends that young adults consider the following tips for successfully navigating credit:
“The college student potentially has 50 years or more of credit life ahead of him or her, making it critical that sound financial habits are established at a young age,” continued Cunningham. “Credit can be a friend or a foe. That outcome is determined by whose hand is holding the plastic.”
Before applying for a credit card, young adults would be well-served by reaching out to an NFCC Member Agency for a one-on-one financial review with an NFCC Certified Financial Professional. To be automatically connected to the agency closest to you, dial (800) 388-2227, or go online to http://www.DebtAdvice.org - For assistance in Spanish, call (800) 682-9832.
The National Foundation for Credit Counseling (NFCC), founded in 1951, is the nation’s largest and longest serving national nonprofit credit counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services. NFCC Members annually help millions of consumers through more than 600 community-based offices nationwide. For free and affordable confidential advice through a reputable NFCC Member, call (800) 388-2227, (en Español (800) 682-9832) or visit http://www.nfcc.org - Visit us on Facebook: http://www.facebook.com/NFCCDebtAdvice, on Twitter: twitter.com/NFCCDebtAdvice, on YouTube: http://www.YouTube.com/NFCC09 and our blog: http://financialeducation.nfcc.org/