Are the cards stacked against you?

Despite results of a recent study showing an increase in student credit card debt nationwide, Bowling Green students don’t fit this profile, according to area banking officials.

Although the national rate of high credit balances has increased, local banks have not seen much debt among college students here. According to Tari Christoff, banking office manager at Huntington Bank, 130 S. Main St., this may be because more students are taking precautions when using their credit cards.

“I believe that many of the students today are more cautious with the use of credit,” she said. “I believe we are seeing more students that are aware of the problems with credit cards.”

The study, conducted last year by the student loan company Nellie Mae, reports that students with balances from $3,000-$7,000 rose by 61 percent. This increase comes despite a 15 percent decrease in the national average credit card debt amount — $2,748 in 2000 to $2,327 in 2001.

Sophomore Alissa Cropper said she knows of people her age who have been in debt, but she has never gotten into credit card trouble.

“I know a few people I used to work with who, when they graduated high school, couldn’t even go to college because they had to work to pay off their credit card bill.”

The study found, on average, that college students double their credit card debt and triple the number of credit cards they own throughout their college years.

Dave Kramb, executive vice president of Glass City Federal Credit Union, 1155 N. Main St., said using a credit card may at times seem easier for students than paying cash.

“It’s too easy to throw a card down on the counter. My advice is to stay within their means,” Kramb said. “Use your credit card, but know your limits.”

Debbie Whitson, branch manager at National City Bank, 735 S. Main St., recommended that students “not carry the card with them at all times, and truly use the card in emergencies.”

Students should only charge what they are able to pay off, Whitson said.

According to Cropper, she owns a credit card but only uses it for emergencies.

“It’s got a $300 limit, so I’ve got enough in my account to cover it. … and I thought it would be a good idea to build my credit up now, start low and work my way up.”

One positive reason for college students to use credit cards is to build good credit early. Most credit card companies offer cards designed specifically to fit students’ needs, according to Whitson. “They’re offering easier, more relaxed credit standards. They also may offer lower limits,” she said.

Kramb offered another positive aspect of credit cards. “I have a daughter who just turned 18 and is a freshman at Kent State University. And when she turned 18, I had her apply for a credit card at our [credit] union,” Kramb said. “I co-signed for her, so I’m also liable for that debt. It really is educational. I encourage her to use it for small purchases she can pay off.”

Another recommendation, Christoff said, would be for students to wait longer to obtain a credit card.

“I think it’s necessary for students to build up credit. My advice is to wait until their junior or senior year,” she said. “[Students should] start with a credit card with a low balance and make purchases using they are able to pay off on a monthly basis so they don’t have to pay high interest.”

Whitson said getting a credit card is an individual decision. “It depends on what that college student wants and when they want it,” she said. “It depends on what their short term and long term goals are: When do they want to buy a house? When do they want to buy a car?”

The Nellie Mae study found that students take on greater debt as they progress through school. According to the study, graduating students have an average of $20,402 in combined education loan and credit card balances. This may be because the purchasing power of credit cards can be irresistible to students who have not learned about interest rates, penalty fees, and rate increases. Because of this, some students may choose to use a debit card or checking account in place of a credit card. Boyd Davis, sophomore, said he only owns a debit card but plans to get a credit card eventually.

“Actually, my mom said it would be better because with a debit card you spend the money you have,” Davis said. “With a credit card you don’t necessarily have the money. I will get one, but not now.”

Starting with solely a debit card may be the way to go, Whitson said.

“I would always recommend a debit card and checking account first. This is going to help them establish their spending and record keeping,” she said. “If they’re comfortable and successful in their checking then a credit card would be the next step.”

But the decision is a matter left up to the individual, Kramb said. “It depends. If someone is unable to control their finances, then that person should have a debit card. If they’re one who tends to spend money on frivolous things, don’t get a credit card,” he said. “But if I’m one who says, ‘Hey, I don’t need that stereo,’ I’m going to start establishing credit.”