Statistic.com reports that the average college student is currently suffering from an average of more than $3,000 worth of credit card debt. These are all undergraduates who have yet to get a job to support themselves. In fact, study shows that 20% of young people within the age of 18 to 14 have debt troubles.
This is not exactly the type of future that we want our children to have.
Even before they become financially independent, these individuals are already suffering because of bad financial decisions. One thing’s for certain, college students are in dire need of monetary instruction.
This is actually where debt management becomes the best option for debt relief. The benefit of having a debt counselor assist you is the access to their financial expertise. Based on their training and extensive experience, you are sure to get valuable advice as to how you can get out of debt. The best part is, the credit counseling agency that they belong to have training programs to help you develop financial management skills. At least, this is true for legitimate agencies – which is why you need to exert extreme caution in choosing the third party company that will help you. The good ones do not only offer to help you pay off your debts, they will also teach you how to never land in the same situation ever again.
The alarming statistics about college students are doubled because the credit card debt is usually a result of unnecessary expenses. They need to understand that wise spending is an important trait to have because it will allow them to put their future incomes on priority allocations. If you couple credit card debt with student loans, graduates will have a lot of debts to deal with even before they get their first paycheck.
By enrolling in a debt management program, college students will be given a debt management plan that will allow them to afford their monthly credit contributions. They will have the guidance of an expert to keep them from failing with the consistent payments that is required by their payment plan. Not only that, this debt relief option will not harm their credit reports. Being as young as they are, a good credit standing is needed – especially when they start looking for jobs. Employers look at a good credit rating a a sign of a responsible individual.
College students should be made to understand that while credit cards can help them with immediate purchases, it has to be paid back. They also have to know the high costs involved with credit card debt. The high interest rate, finance charges and late penalty fees make up for a hefty payment on top of what is originally owed. While parents can still bail them out at this point, they should be taught the right financial management skills that will mold them into more responsible adults. Giving them the freedom to spend on things that they want should be coupled with the responsibility of paying off what they owe. Parent can give them a budget every month and at the same time teach them how to stick with it. Proper financial management should start early so it is not difficult to follow as they age.