When surveyed about the reasons that they first take out a credit card, college students inevitably rank a concern for credit scores as their primary motivation, beating out even convenience and protection in case of emergencies. To a degree, of course, this is utterly specious, and we would expect our most responsible and ambitious young Americans to underscore the importance of FICO and Vantage figures (highly complicated logarithms guarded zealously by the three credit reporting agencies and only vaguely understood even by seasoned consumer finance professionals) above their desires for late-night pizza runs or shopping binges.
All the same, though, it is true that credit card debt payments are an excellent means of creating and then elevating the three-digit scores, and the credit bureaus will admit that the length of time that unsecured lines of credit are held in good standing also plays a significant role in the numerical calculations. Perhaps the rationalizations of teenagers and their parents — who, after all, should bear much of the blame, particularly after 2009 legislation newly prohibited credit card companies from issuing cards to minors without an adult over the age of twenty-one co-signing — rather disingenuously shies away from true motivations for the proliferation of borrowing privileges, but the usefulness of credit scores within modern society can’t be so easily dismissed.
However, that said, our country’s current credit card debt relief crisis didn’t come about because of faulty FICO ratings. No, as a society, the people of the United States have become all too used to carrying around enormous debt burdens that would have been unthinkable even one generation ago, and, the earlier that consumers first start borrowing, it simply stands to reason that they’ll become that much more inured to the constant pressures of affording the bills on several cards whose balances only seem to go up thanks to the combined effects of minimum payments and compound interest.
If the young men and women attending our colleges and universities could truly maintain the rigorous discipline and enlightened perspective sufficient to only pump up the balances to levels they’ll be able to reliably satisfy in full every month, the benefits to credit scores could indeed provide untold advantages down the road, but, considering the nature of teenaged consumers first away from home, the risk may well outweigh the reward.
To be honest, economic analysts and financial counselors attempting to slow the tendencies of young Americans to blithely embrace the world of lifelong credit card debt have identified another culprit beyond naïve shopaholics and corporate profit margins. Ever since the United States Congress enacted legislation designed to prevent former students from discharging their educational loans through Chapter Seven bankruptcy debt relief, kids have had little choice but to think about borrowing in a different light.
Although there were certainly fiscal practicalities spurring the changes to the code — the most vital obligation of the government must be to help the progression of our most capable minds and eager hearts, regardless of their social standing — one has to appreciate the societal repercussions. Effectively forcing incoming freshmen from impoverished backgrounds or difficult familial situations to assume liability for tens of thousands of dollars for even a single year’s tuition (knowing all the while they’ll have to avoid bankruptcy and debt settlement as possible options should their careers falter) hardly encourages students to beware the evils of monetary obligations.
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