Diminished Returns

I get furious every time I read something like this. Yes, I get that some young people are totally irresponsible with their first credit card…I was.  However, for those that don’t have wealthy parents or full ride scholarships, (like someone who carries a “D” average in High School but can dunk a basketball, for instance) credit cards provide a bridge between the time a student is in school, until the time they can begin earning.

Part of me would be more sympathetic to the banks that issue the cards if they weren’t so damn deceptive in their business practices.  It has always irritated me that credit card issuers are able to arbitrarily “adjust” the interest rate on your card.  Again, if interests rates soar, I can see the need for banks to raise rates…but that is seldom the case.  If you are late with them, or, late with another card you hold, or, in dispute with a vendor or retailer, or, EVEN IF THEY DON’T LIKE WHERE YOU USE YOUR CARD, they can and will raise your interest rate.  The rate hike is almost never proportional, that is, it is frequently doubled, or even tripled!

Many grown-ups have trouble managing debt.  Expecting a college freshman, straight out of high school, to be able to manage theirs is ridiculous.  I think that is the point, maybe.  Do banks intend to saddle young people with crushing debt that could take a lifetime to repay?  I’m beginning to think so.  If not, why aren’t they more selective?  Or, why not lower card limits?  A $2500.00 credit limit can do a great many things….pay for a car repair, books, etc.  Easy, nearly limitless credit drives up prices for everyone, and allows colleges to charge nearly anything.

I wish credit card companies were banned from campuses.  If you can ban alcohol, you can ban credit card companies.

For years, we have told our young people to seek degrees in law or business and the easy life would follow.  I’m wondering about those kids and their parents that mortgaged houses and sacrificed for years to send a kid to school, who is about to graduate this June with a degree in business.  It will interesting to see how many years working at Circuit City it will take to justify that pricey diploma.  Oh, wait.

I know that credit cards and college costs are only connected by the barest of threads, but both seem more than a little predatory on our young, emerging workforce.

11 Comments

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11 responses to “Diminished Returns

  1. I was at Walmart recently, and decided to read the credit card application. You want to talk about predatory lending? It was brutal.

    It’s just plain stupid to put tuition on a credit card. Then again, these are Huffington Post readers…

  2. democommie

    Mack:

    I just got a letter from one of my credit card companies saying that in light of re-examining my purchasing and bill paying activity over the last year that they are adjusting my interest rate to 12.99%. This is after I barely used the card since the adjusted it to 17.99% when I had been paying the balance in full for years and spending about 15-20K a year on that card. Obviously, they are clueless.

    Exador:

    You are, quite simply, full of shit.

  3. Here’s my own anecdote on credit cards. Circa 1995, I was in college and went to sell my books back at the end of the semester. On the way into the bookstore, almost blocking the entrance was a table with 3 people, stacks of t-shirts and other swag and handy dandy clipboards to sign up for a credit card. The workers were almost like carnival barkers: “sign up for a credit card, get this free tshirt!” I bit. In order to “build my credit” and “use it only in emergency situations”
    - turned out my first emergency situation was dollar draft all summer at my favorite watering hole.

    Meanwhile, 3 years earlier, a childhood friend’s mother had gotten divorced. For years, all of her credit cards were in the name “Mrs. Larry Smith” – once she was divorced, she basically had no credit history. Could not get a credit card.

    Now, how ass backward is that? Anyone who tells me CC companies don’t prey on the young and stupid, I have a balance you can pay. ;-)

  4. democommie

    Beth:

    Change “young and stupid” for “uninformed” and you’re correct. Once people have been informed they are no longer such easy prey. For that reason you will never see the parasites of plastic offering seminars wherein they tell the truth about consumer credit.

  5. Sorry, democommie. I didn’t mean to say EVERYONE with a Walmart credit card is stupid. I’m sure yours works just fine for you.

  6. democommie

    Exador:

    Huffpost readers are not by and large your average Wal-Mart type. But you, apparently, are.

  7. My, how elitist of you. I guess some animals are more equal than others.

  8. If you doubt the evil of CC companies, watch the documentary “Maxed Out”

    As for Wal*Mart cards and other box stores (including those in the mall), I was always VERY aware that those were the worst of all. And always steer clear of them, no matter how many times the kid at the register tells me I’ll save 10% at the register. Yeah, 10% now, but pay 28% for eternity. No thanks.

  9. Beth, I saw maxed-out, it was very informative.

  10. democommie

    Exador:

    That’s what I like about folks like you. First you make a lame comment, that’s without any subtance, just to poke a stick. Then, when you’re called on it, you make a LAMER comment.

  11. Pingback: Beware The Ides Stars of March « A Natural Deficiency Of Moral Fiber

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