A UB student strolls through the mall, hot on the trail of a new pair of shoes. The perfect pair sits in a display window. No cash? No problem. The solution is plastic. As the student strolls away with their newest purchase, in a far off computer system, a monthly balance rises.
As credit card debt grows nationally, it is a mounting problem for college students, according to director of Career Services Dan Ryan, Ph.D. UB students are not an exception to the credit epidemic.
"I think the student without [a credit card] is in the minority," Ryan said.
According to Ryan, who also gives credit workshops as part of UB's Life and Learning Series, there are several things that students should consider before getting and using a credit card.
The biggest risks that students take when using a credit card are either paying only the minimum balance, or paying the bill late. Paying only the minimum balance means that interest will build up, Ryan explained. Paying late creates a permanent mark on a person's credit history, which damages their credit rating and may cause future problems.
"People with bad credit histories pay higher rates for just about everything they don't pay cash for," Ryan said.
A bad credit rating can lead to everything from difficulty in getting a cell phone plan to a higher mortgage. Therefore, students should be careful about how they use their cards, Ryan said.
Alex Luce, a freshman biological sciences major, uses a credit card linked to her bank account to provide overdraft protection. She is currently in a small amount of debt because of the cost of her textbooks.
Luce controls her balance by limiting how much credit she has. She refuses to allow the bank to raise her credit limit.
"They asked me if I wanted to increase my limit - I told them no," Luce said. "If it went any higher, I'd be in trouble."
Students should be conscientious of how much they're being charged for interest rates either at the time of purchase or at the end of the month, according to Ryan. Students can lower their interest rates by calling their credit card company every few months.
"For the cost of one telephone call, you can save yourself a considerable amount of money," Ryan said.
Kimberly Falkowski, a junior environmental studies major, currently has seven cards, including store cards from Target, Macy's, Wal-Mart, JC Penney's and Dick's Sporting Goods. She originally used the cards to pay for college expenses, but later used them to pay for items like Christmas gifts, clothes, gas and groceries.
Despite being in debt now, as the college lifestyle is undoubtedly expensive, Falkowski said credit cards are what get her through each year.
"I don't know how I would have survived without them my first year and a half of college," Falkowski said.
Falkowski admitted that, while she purchased some necessities, a fair amount of her monthly limit was spent on unnecessary expenditures, resulting from the common mentality that comes from paying with a credit card: it seems like no actual money is being spent.
"You don't actually have to count out the cash, so [you] don't have to think about how much you're spending," Falkowski said.
Ryan recommends that students keep a credit card to use for emergencies only, as students who find themselves using their cards more and more for unnecessary purchases are often the ones who end up in the most debt.
Students who do find themselves in debt should pay as much of each balance as possible - ideally, the entire bill. Most importantly, students should stay informed about their cards, policies and interest rates.
"It's not a bad idea to have a credit card; it's a bad idea to use it," Ryan said. "The more informed you are, the less likely you're going to be to get yourself into trouble. You're going to think twice before you make a purchase."
Photo: Courtesy of Laron Fomby
