New credit card act brings changes for students’
Published: Wednesday, March 3, 2010
Updated: Wednesday, March 3, 2010 15:03
Credit cards are the evil enemy to college students everywhere, or that's what we have been told.
But what has the recently passed credit card bill done to help those of us who could not resist the temptations of being a cardholder?
78 percent of households were owners of a major credit card according to Nelson Report of 2009, which amounts to 91.1 million people, and this number is expected to grow in 2010 to 181 million.
So what is America's fascination with plastic? At first glance, these cards seem to bring with them a lot of benefits like traveling and shopping points, but many people fail to see the dangers that credit cards pose to one's credit, which the government states outweighs the benefits. With the changes being placed on the current policy, the Credit Card Act of 2009 is creating changes that are being implemented to try and make charges easier on the average day consumer that is now struggling in the recession.
One way that this new bill proposes a change is by making it very difficult, if not impossible for lower income families to be able to obtain a credit card.
Research has shown the individuals who have gotten into most financial hardships with the help of these credit cards are families who do not have the income to pay the payments off once they have made their purchases.
Along with many other significant changes made to the current system, what matters most to many students here on Muskingum University's campus is the limited credit to young adults clause.
This clause states that credit card companies are forbidden from issuing a credit card to any individual under the age of 21, but may do so if that individual has an adult cosigner.
Although this rule may seem very strict there are some provisos in which could help out young college students.
The credit card act of 2009 states that credit card companies cannot use "freebies" to lure students to fill out these credit card application forms if the said students are within 1,000 feet of a college campus, but the exchange of freebies is allowed if an individual does not have to fill out an application form.
The government has also issued that anyone under the age of 21 years of age has to show proof that they make the income that is needed to support themselves and the charges that are expected to be made in the credit card itself.
There are mixed opinions as to what this new law means for the young college students as well as people all over the United States.
Kevin Hipps, a former student of Muskingum University believes that this new law is a good idea for young people looking to stay out of debt.
"I had a credit card when I was under the age of 21," Hipps said. "And all it did was create more problems for me later on down the road."
Some people believe that credit card companies prey on students who they know can't afford to pay the charges off and it puts them in debt.
"Many students under the age of 21 are immature and don't realize how badly they can hurt their credit when they can't make the payments," said Hipps. "It's hard to dig yourself out of early debt that is accumulated after using a credit card."
Others feel that this law is infringing on their rights as adults to use a credit card. Krtistin Wilson, a junior here at Muskingum, believes that it is a fine line.
"I don't know exactly how I feel about the issue," said Wilson. "If it helps the national debt decrease then it think it is a good thing, but I fell as though it does take away some of the rights I have as an adult."
No one can say whether or not this new plan will have any effect on the debt that many Americans accumulate, but at least there are actions being taken to see as to what can be done to try and heal the blow of this recession, and only time will tell as to what happens next.