Students spend a lot of time focusing on their GPA and test scores, but credit scores matter, too.
The “Money Talks” event at TCU focused on issues with credit and credits cards.
Brooke Shuman and Keri Cyr, both from Student Development Services, gave the presentation and emphasized the importance of building good credit while in college with responsible credit card usage.
“It’s important to understand how to properly use credit cards because people can very easily acquire lots of debt quickly,” Shuman said.
In a 2007 survey conducted by Charles Schawb showed that only 45 percent of teens understand how to use a credit card and 27 percent understood the fees and fine print.
When those in attendance were asked if they had a credit card, two in the group of 17 students raised their hands. Shuman said she believes the fear of debt may play a role in the small number of students with credit cards.
“More often than not, I get students in my office saying that they are afraid to get a credit card because they don’t want to fall behind on payments,” she said. “It is important to learn how to spend the right way though because credit cards can help you build good credit.”
While fear is one factor as to why some are hesitant to get a credit card, the law may also play a role in their decision.
The Credit Card Accountability Responsibility and Disclosure Act of 2009 makes it harder for young people to obtain credit cards through stricter co-signer requirements and the disclosure of all agreements between universities and credit card companies.
First-year biology major Prabhesh Patel said he found the presentation helpful.
“It helped me realize that I may need to start building credit out a little earlier,” he said. “I got some really good information out of it.”
Patel said he was surprised at the importance of having a good credit score and how long it takes to build a good credit score.
“Having a good credit score due to responsible spending can give students the freedom down the road to make bigger purchases without their parents helping out,” Shuman said. “Everybody should want financial freedom.”
Sydney Duettra, a first-year pre-major, said she was thankful for the helpful tips she got from the presentation.
“It helped me realize that, while I still want a credit card, I have to be responsible with it because I can see the problem that comes if you aren’t,” she said.
Many undergraduate students around the country feel that they are undereducated when it comes to credit issues.
According to a Sallie Mae’s National Study of Usage Rates and Trends survey conducted in 2009 84 percent of undergraduate students feel the need for a financial management class. And 40 percent of freshman said they feel the need for financial literacy education.
The Student Development Offices will also be giving a presentation on budgeting and different types of insurance. Dates have not yet been posted, but their offices are located at the Brown-Lupton University Union in room 2003.
This story was updated on Nov. 20, 2013 at 4:36 p.m.