Monday, January 18, 2021

Paying credit reveals hidden expenses

Credit cards can be tempting to use. For every tuition payment made with a credit card, students are also charged added fees called convenience fees, according to CreditCards.com.

Convenience fees vary by institution, and a recent study by College USA Today, concluded that the“most college-friendly institution” with credit card convenience fees are community colleges.
PSUC currently doesn’t charge student convenience fees for paying tuition using a credit card, according to PSUC Associate Director of Financial Aid Kerry L. Lubold.

Junior international business major and global supply chain management minor major Julissa Vera said she didn’t know PSUC didn’t charge the additional fees.

“Oh that’s great. I think that’s awesome that Plattsburgh doesn’t charge convenience fees,” Vera said. “Plattsburgh isn’t as expensive as some other schools, and that’s really good that they do that. A lot of people probably don’t know that either.”

Vera said that this should be known by prospective students because it could be a determining factor for deciding high school students.

Ninety-seven percent of community colleges accept payments via credit card but only eight percent charge a convenience fee. Private institutions fell at the other end of the spectrum, with 77 percent accepting credit card payments and 51 percent charging a convenience fee, according to College USA Today.

“The cost of doing business is becoming more and more of a factor as they try to balance their budgets and provide good services to students, and all those things that come with doing commerce today so I wasn’t surprised by it,” she said.

Lubold said her role is to provide a support system for families as they’re trying to make decisions about college expenses.

“They need to be aware that there are alternatives to using a credit card like enrolling in a payment plan or student loans or parent loans,” she said. She also said students should look into various scholarship opportunities.

She said being aware of these options allow families to find the right decision for them financially.

“If the credit card is the right decision for families, then it’s about making sure they understand what the cost is going to be.”

She said that families should be aware and consider all of those options wholly.

“Sometimes it helps just to talk things over and I’m always of the opinion that it never hurts to have too much information,” Lubold said.

Lubold said students never know when a new oppourtinity will come up.

Lubold said there are obstacles when using a credit card.

“There are usually long-term challenges when it comes to using a credit card, like trying to pay it off,” she said.

Lubold said students should be aware of interest and any other additional fees the credit card company may charge.

“I’d be surprised if most people know about convenience fees,” she said. “The fact that colleges charge fees on a credit card for tuition typically occur because the credit card company charges the school, such as Visa and Master Card.”

Lubold said consumers don’t typically realize the power of paying with a credit card when they do it on a daily basis.

“Most of the time, we all operate everyday doing commerce and often aren’t charged a fee to pull out our plastic cards,” Lubold said. “We pay whatever is on our receipts because those fees are usually absorbed in other ways.”

Lubold said that when it comes to students, especially freshmen, this is their first time being marketed for credit card opportunities. She said there are various opinions on if credit cards are good for college students.

“I tend to come from the perspective that usually it is OK for a young adult to establish their name with a credit card and establish their credit history that way,” she said. “It’s actually good to start building their credit.”

Lubold said once students are out of college, the first thing that might build their credit is the existence of student loan debt that now needs to be paid off. She said to have a credit history start in such a positive way is difficult.

“Not getting enamored by the ability to have purchasing power while not having the money immediately to make those purchases requires a very controlled thought process.”

Lubold encouraged students to visit the financial aid office if they are having a hard time understanding or maintaining their expenses.

“We’re a wonderful resource. Sometimes, students are intimidated or a little ashamed to ask for help, but all of us can use a little help when it comes to money.”

Vera said she has a lot of loans and financial aid. She also uses an American Express Card from time to time to pay monthly college expenses. She said she was also given a debit card during her freshmen year. Vera said students should understand the risk of using a credit card.

“I think it’s convenient at the time, if you really don’t have the money so you say ‘You know what? Let me just use my card,’” she said. “I mean it obviously depends on what you’re paying, but you’ll end up paying for the convenience fees.”

Vera also said that students should do their research. She said there are so many scholarships that people don’t apply to.

“Once you get to college, you need to start learning about payment options,” Vera said. “Learn about loans and what additional fees go with that. Learn your finance.”

Email Kavita Singh at fuse@cardinalpointsonline.com

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