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Jackie Burrell

Credit Card Reform Impacts College Kids Too

By May 26, 2009

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Calculator & Credit Card (Photo by Steve Woods, Stock.Xchng) It was just a couple of weeks ago that I was ranting about credit card companies targeting college kids at move-in day, sports events and other campus events. The average kid was graduating from college with four or five credit cards, and $4,138 in credit card "loans" at 18% interest. Might as well just hand over the kidney now. Congress was equally concerned. The new credit card reform law President Barack Obama signed last Friday not only impacts credit card fees and interest rates for everyone, it limits credit card companies' ability to rope in young adults still struggling to get their own personal finances in order.

The Huffington Post's Jim Randel calls the restrictions for the under-21 crowd "nutty lawmaking" that treats young adults in "paternalistic" fashion. Under the new law, young college students will have to have a co-signer or prove they have some kind of revenue stream before they go into debt. I fail to see how that's nutty. It seems to me the height of financial responsibility to provide young adults with a graduated introduction to the world of credit cards, rather than the current practice of bribing them into debt with a free iPod if they sign up now. Your thoughts?
May 28, 2009 at 9:15 am
(1) Ted Murphy says:

I think debt for a young person is an absolute killer. They are at a time of their life when consistent payments are very difficult, and they also need the flexibility to go down unknown paths grad school, travel, etc). This is an instance of father knows best.

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