College Student Debt

Credit card companies have found an eager market in the nation’s fickle college students, who are all too ready to charge up a mountain of debt with nary a thought of the consequences.

But there are consequences. Indebted college students, poorly educated about finance, debt and savings, leave college owing an average of $20,000, of which $3,200 is unsecured credit card debt. This amounts to a huge post-college burden, as the average starting salary for a recent graduate hovers around $30,000.

So who’s to blame?

• The credit card companies, at least partially, for foisting cards upon uneducated kids knowing full well that most of them are unprepared to navigate the very adult world of consumer debt. They are confident that if these kids’ parents are willing to pay for school, then they will help out when their son or daughter winds up in financial distress.
• The colleges and universities across the country allow these credit card companies to set up tables and booths on campus. These institutions have a responsibility, as educators, to at least help their students learn the financial basics and shield them from the grasp of big-time lenders.
• The parents themselves, for not educating little Sally and Bobby college student about the dangers of credit card debt. It is imperative that parents teach kids early on about finance. Without proper education, debt can stay with an American consumer for life, and the earlier they are warned about debt the less likely they are to wind up buried in it.

For already debt-addled graduates, there is help.

• First, pay more than the minimum balance on your cards every month. Paying just the minimum is a surefire way to prolong your debt for years, if not decades. Pay as much over the minimum balance as possible, and once you’ve paid off the card with the lowest balance, move on to the next.
• Create a budget. This will help you eliminate wasteful and excessive spending. Oh yeah, and eliminate wasteful and excessive spending. Do you really need internet at home? That new Louis Vuitton purse? Food? Ok, you probably need food, but be very careful about your spending.
• Save. You may think you don’t have enough money to start saving now, but you do. Focus on paying down your debt, but set aside a little bit every month for an emergency fund. Use this money to pay for stuff like car or home repairs and hospital bills. If your company has a 401(k) plan, join it. It is never too soon to start saving for retirement.

Those unlucky souls who’ve accumulated more debt than they can reasonably repay (we’re talking MAJOR debt, definitely more than $20,000) have two options:

• Bankruptcy, which is never fun, will stay on your financial record for at least seven years. It’s scary to think of starting off your adult life by filing for bankruptcy, but unfortunately some have no other choice.
• Debt settlement. Some creditors will work with you to cancel a portion of your credit card debt. You pay off the remainder, but your settled debts are cleared much faster. Debt settlement companies have valuable experience and can help lower your credit card debt more than you can on your own.

Author Bio: Drew Johnson is an expert in the various methods of debt reduction and has successfully reduced his own debt. Read additional articles by Drew on Debt Management, Credit Management and more.

Related Debt Consolidation Articles

• Our Program Guides You Out of Debt
  Many reasons may contribute to Americans collective colossal consumer debt.
• Become Stress Free by Finding Debt Relief
  Debt consolidation and our service can lead to a stress-free life, though they relieve stress differently.
• Save Money and Find Financial Freedom
  Debt consolidation loans help control unmanageable debts, while Credit Solutions' programs help you eliminate debt.
• Be Debt Free Without Secured Loans
  When your debt level is outpacing your disposable income level, you can find the most debt relief through a Credit Solutions program, not a secured debt consolidation loan.
• Financial Freedom with Our Debt Solution
  Debt consolidation and our service are realistic ways to become debt free, though settlement takes less time to eliminate your debts.

Bookmark this Post: Select From Listdel.icio.us Digg it Earthlink Furl iFeedReaders ma.gnolia Maple.nu Netvouz Netscape RawSugar reddit Scuttle Shadows Simpy Spurl StumbleUpon Wink Yahoo MyWeb

You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response.