A recent survey report issued by Experience, Inc., entitled "College Life — Finances & Banking," breaks down the financial situations and concerns of almost 5,000 students at universities and colleges across the nation. Experience also investigates the trend toward reliance on credit cards and the growing necessity for student loans, providing statistics on how students are spending their money and the types of purchases they make.
The major financial concern for college students is, expectedly, paying for school. Experience, Inc., finds that the majority of students, 26%, make ends meet by taking out student loans. Nearly a quarter, 24%, reported that they were able to pay for tuition with earned scholarships. The same percentage reported having to work while attending school.
However, the costs of higher education don't stop at tuition, nor does the need for loans. Another major expense that students must consider is financing an automobile. Many students finance vehicles through banks or credit unions. Experience, Inc., reports that 22% of college students have shouldered this responsibility, while 34% of students' parents are handling their car payments.
When dealing with such large sums of money, it's useful to know what students are expecting from their financial lenders. Experience, Inc., asked the students it polled what is important to them when choosing a bank. Due to the budget crunch of college, it makes sense that the highest percentage of students say their number-one concern is fees. What may be surprising is that the same percentage of students, 18%, rank ATM availability as a key criterion. For a generation accustomed to accessibility and immediacy, efficient banking is very important.
Interest rates and reputation tie for second priority, as each is most important to 14% of students. Superfluities such as free gifts and brand recognition only persuade about 5% of those in college. Aside from borrowing in the form of loans, students have also been flashing the plastic and borrowing from creditors. Students base their selections of credit cards on reward programs, low interest rates, cash-back bonuses, and special store discounts. About 38% of college students have one credit card, and 34% are balancing two. And they're definitely using them. Almost half of student spending is on basic necessities, such as groceries and toiletries—the odds and ends needed to keep the dorm room running. However, an alarming 21% of students are using their cards for excessive expenses, such as entertainment and dining out. 13% are staying in style by charging clothes, and a mere 11% use credit cards to pay for books.
There is definitely a lot of charging going on, but how much is being paid back? Many students practice responsible borrowing by staying on top of their credit card balances. 58% are paying them off in full each month. Just 5% are only making minimum payments. With the inflated interest rates given to first-time cardholders, students can find themselves in massive amounts of debt if they do not spend wisely during their college years.
Despite all the variation in terms of where students spend their money, a pattern is apparent. Students reach "financial adulthood" once they start college. They must learn how to budget their allowances and make smart purchases. Students must also be aware of how their current spending will affect their financial futures. Before students enroll, it's important that they educate themselves about money matters.
Article Title : College Student Money Matters
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Education is one of the most basic right of any human, but with the increase in prices and the costs involved in education this has made these rights turn into a privilege which very few can enjoy. Any normal person today in the whole of United States has to take an education loan at one point of time to pay for their education fees.