Today, 70 percent of undergrads and 96 percent of graduate students have at least one credit card in their own name, and few know how to properly manage their accounts, according to a study entitled Financial Literacy and Credit Cards: A Multi Campus Survey, published in the International Journal of Business and Social Science. About 36 percent of college kids have two or more credit cards in their name.
Just 9.4 percent of those polled said they pay their balances off in full at the end of every month, and very few actually knew the cost of their accounts, the report said. Only 14.6 percent knew the interest rate on their card, while 24.3 percent and 29.2 percent claimed knowledge of their late payment and over-balance penalty fees, respectively. Altogether, only about 10 percent said they knew all three.
The Credit CARD Act requires consumers under the age of 21 to either obtain an adult co-signer on their account or provide proof they can afford a credit card on their own.