According to recent study conducted by the student loan company Sallie Mae, 82% of college and university students report at least one credit card debt problem every month.
To address this, the government has implemented major changes. The changes were timely, since the research by Sallie Mae also reveals that 84% of all undergraduates already own at least one credit card and to reiterate, 82% of the 84% of undergraduates with credit cards fail to pay debts on the due date.
Today there are stricter guidelines for young adults who want to get credit cards for themselves. This is for them to seriously reconsider the necessity for acquiring a card and realistically assess if they can responsibly manage their accounts once opened.
The major changes include the requirement of at least two adult co-signers to endorse a credit card application for an individual aged 21 and below.
The mandate for colleges, universities, alumni associations, and other organizations to declare existing and future agreements with credit card companies is another change introduced.
This will help shield the financially unstable, vulnerable market of the young adults from false marketing and deceptive claims of credit card companies. The card issuers are able to access alumni and student contact numbers by paying associations, organizations, etc
Marketing inside the campus with the usual perks like food, alcohol, and sponsoring night parties care of the credit card companies will also be prohibited.
Also, students who have joint accounts with their parents will be required to ask for their parents consent (guardians included) whenever they ask their banks for credit limit increase, Dragon says.
These changes, though they do not assure any major shift towards financially responsible management of the young adults, will at least help mitigate the growing problem of debts encountered by people early on their lives.Changes, at the onset, shield incoming young adult credit cardholders.
Students who are already well aware of their debt problems must still make a conscious effort with consistent monthly payments. This will help the student regain opportunities to qualify for mortgages, car loans, and other important financial prospects in the future.
With these major changes being implemented, people are hopeful that it will show positive results in credit card management by the youth.