Legislators in the United States are seeking to rein in credit card companies that give large lines of credit to unemployed college students. This practice sets up students to graduate with excess credit card debt before finding stable income.
Credit card companies often rely on legal loopholes and variable interest rates to make a profit, but for students who don't fully understand the effect of long-term payments and debt on their credit record, these practices can seriously affect their finances.
The final responsibility, however, comes down to the individual, and Jessica Silver-Greenberg of Business Week provides a few ideas to help young people build good credit and stabilize their finances ("Fixing the College Credit-Card Mess," Sept. 7, 2007):
• Limit the amount of debt you incur. Choose cards with a credit line of $1,000 to $2,000 instead of multiple thousands to avoid the temptation of excessive spending.
• Be an informed student and understand all the fine print that comes with credit card statements to avoid missing key information.
• Avoid credit vendors that have a record of unfair business dealing, and pay off credit bills on time and fully, whenever possible.
