A study done by Higher One and EverFi, as recently reported in a recent USA Today article, stated that students in 2014 were more likely to have and use more than one credit card than they were in the past.
The article continued by saying that “those same students were far less likely to pay their credit card bills, make and stick to a budget, put money into savings, balance their checkbook or track their credit score.”
In the article, Phil Schuman, the director of the financial literacy program at Indiana University, suggests there’s a trend in trying to keep up with the spending habits of a student’s peers. “I think that students are prone to making mistakes in college because there are more things out there for students to spend their money on,” Schulman said.
Plattsburgh State English writing arts and English literature major Timothy Murphy said he doesn’t have a money-managing problem, but thought a lack of effort in managing one’s money could cause similar problems.
“I’ve never opened a credit card account, and at this age that’s something most people expect you to have done,” he said. “I’ve saved my money — most of the money that I (personally) make, but I’ve never invested or opened up a credit card. I haven’t put in the full effort towards managing my money.”
PSUC economics and finance major Blake Protzman said financial aid and student loans may also contribute to increasing student financial irresponsibility.
“The way I see with the reckless spending and such — student loans have become so easy to get. You don’t need credit; you just need a cosigner,” Blake said. “They provide so much extra income to students that they don’t need. You can have all of your college paid for, like your tuition, but you can still have extra money from the government. Tuition keeps rising as student loans increase.”
Social work major Frank Arduini said he doesn’t have a problem managing his money.
“I know what’s in my bank account, what I can and can’t afford. My parents help me out, but as far as what I spend it on and how I spend it, it’s on me,” he said.
Arduini continued, saying students may feel pressure from their friends or peers to spend money on unnecessary items.
“People are more likely to buy things because it’s the trend,” he said. “If you say, ‘I don’t have an Xbox,’ it’s a lot different now than what it would have been, say 30 years ago.”
Protzman agreed, saying he has especially noticed this trend in terms of alcohol.
“If your buddies are going to go down to the bar, you’re going to go too,” he said.
Murphy said although he has not faced monetary problems, he knows people who struggle with managing their money but doesn’t think the pressure to spend is a trend that his friends have to deal with.
“I don’t know anybody that’s (sic) felt peer pressure, like their friends bought a cool product, or their friends getting involved in this new market, so they wind up getting involved with it.”
Murphy said he was on the freshman meal plan last semester, but after running out of Dining Dollars, he felt he was severely limited on his meal choices and became stuck between spending actual money and using meal swipes at on-campus locations he didn’t like.
Just this month, Murphy ran out of meal swipes, so now he has to manage his Dining Dollars.
“Now I’m on a better plan, so I’m managing my Dining Dollars now to make sure I can get through the end of the semester without having to spend money on outside food sources,” he said.
Although there is proof that college student spending has increased over the years, Arduini said he doesn’t believe any expense students splurge on now is different than those of the past.
“Some of the things our parents would save up forever to buy, like music, is now really cheap. Those things have been replaced with other things,” he said.”Back then, people would buy VHS tapes and records, and all of it was expensive. Now you have Spotify where you get all of it for free and Netflix for $8 a month — it’s different.”
As far as budgeting, Protzman said students should anticipate how much money they will need for a couple of weeks at a time and monitor it closely.
“Cut back. Don’t do the frivolous things like go downtown or get Bono’s at 2 in the morning,” he said.
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