Credit Management for College Students

Society-Ready Graduates
Research Year: 
2003
Issue: 

According to the July, 2002 Nellie Mae study, Undergraduate Students and Credit Cards: An Analysis of Usage Rates and Trends, 83 percent of undergraduates attending four- year institutions possess at least one credit card. Credit card companies frequently market their products to students and credit is readily available to students at the University of Arizona, resulting in a rise in personal debt. Little is done to provide students with personal financial education to ensure that the students have the basic money management skills necessary to manage credit wisely. Undergraduates in the 2000 Nellie Mae analysis carried an average credit card balance of $2,748, up from an average of $1,879 in the 1998 study.

Description of Action: 

It is obvious that credit problems for college students are a serious problem that will only get worse. To provide assistance to those already in trouble and to prevent others from following in the same path, the Take Charge America Institute for consumer Financial Education and Research (TCAI) was established in the School of Family and Consumer Scinces in 2003 with a $10 million endowment from Take Charge America in Phoenix, AZ. The mission of TCAI is to bring financial information to students and families in Arizona and across the nation. To support student outreach TCAI funds the Credit-Wise Cats program as part of the Students in Free Enterprise (SIFE) Team. Credit-Wise Cats (named after the University of Arizona Wildcats) was created to provide financial education to University of Arizona students and faculty. This project was started through the SIFE Team and has grown to include workshops, one-on-one counseling, scholarships, a case study competition and the development of a general education personal finance class at the university. Three main components include:

Credit-Wise Cats Educational Workshops

In the 2002/2003 school year, the Credit-Wise Cats program goal was to educate as much of the university population as possible on the wise use of credit as well as overall good budgeting and money management skills. This task was accomplished by providing faculty and students the opportunity to attend informational workshops on money management and credit cards as well as create a "financial fitness" competition that allowed individuals to work one-on-one with the counselors and receive a more detailed education on the previously mentioned topics. Through the course of the school year Credit-Wise Cats met with more than 800 students through workshops and one-on-one counseling sessions.

Duel in the Desert case study competition

The TCAI funded regional personal finance case study competitions that were held at four universities across the country, Purdue University, University of South Carolina, Texas A&M and Colorado State University at Fort Collins. The top three schools from these regional competitions were invited to compete in the national Duel in the Desert competition held in Tucson, Arizona. Twelve schools were invited and competed by solving a complex personal finance case study involving a family in Tucson facing high debt and serious health issues. The teams were given 36 hours to develop their solution and then had 20 minutes to present their solution to a panel of judges. The Ohio State University was the winning team and was awarded $3000.

Personal Finance General Education Course

In the spring 2003, a "Money, Consumers and Society" course was approved as part of the general education curriculum and will be offered to freshmen beginning in fall, 2004.

Impact: 

Students participating in Credit Wise Cats activities reported a 33 percent increase in knowledge of credit and debt management; 82 percent plan to control spending and 88 percent intend to reduce their debt. Credit-Wise Cats was able to influence a large audience and provide a great deal of information to a very vulnerable group: 990 students were directly reached in 2002-2003 through informational workshops, one-on-one conferences, the "Money Talks Speaker Series, and a Consumer Issues course. Credit Wise Cats was also very successful through the media. The program was featured in more than 5 articles in major local and statewide newspapers in 2003 with a poulation reach of over 350,000.

"This program has helped me better understand the choices I have with my spending."

"I never realized the importance of a credit report before I attended one of these sessions. I am going to order my report as soon as I get home!"

"I have been one of the counselors for two years and I have learned so much about my own habits. It has been very valuable."

Funding Agencies: 

Take Charge America, Phoenix, Arizona

Conact Name: 
Melinda Burke
Contact E-mail: 
Contact Address: 

School of Family and Consumer Sciences

The University of Arizona

PO Box 210033

Tucson, AZ 85721-0033

Tel: (520) 621-1295 FAX 3209