Credit cards on campus: Should college students pack plastic?

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Peanut butter and jelly. Bert and Ernie. Jay-Z and Beyoncé. College students and credit cards. All of these famous pairs are great combinations, right? No?

One stands out, and it’s not Blue Ivy’s fierce parents.

College students and credit cards have long been known as a particularly bad combination. In an April 2012 study, academic researchers from universities including Texas A&M determined “credit cards on campus have been a disaster.” The study found that in 2009, the average college student graduated with over $4,100 in credit card debt and more than 50 percent of college students have four or more credit cards.

That does not sound good.

I started using a credit card a year ago, during my junior year of college, only because my parents wanted me to have one while I studied abroad in Argentina. I’m squeamish about using credit cards because of all the horror stories I’ve heard about them. I know I’m responsible, but paying a credit card bill is a new experience. How do I know I’m ready for that?

My friend Zach, who goes to school in Indiana, said he recently decided to get a credit card, before his senior year of college, in order to build credit before he graduates in the event he will need a credit history to secure an apartment, finance a car, or even as part of a job application.

“If the world could operate without credit, I think we would save ourselves a lot of issues, but that’s just not the case…” he said. “But I don’t want to know what situation I would be in if I didn’t have any credit when I graduated.”

He says he uses the card very little (like I do) and stays conscious of not running up large bills. As a result, having the card has been a positive experience.

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But not everyone feels that way.

Sarah, another college senior who started using a credit card this year, says she wishes she did not have one. “My parents encouraged me to get a credit card, and it’s been stressful for me,” she says. “I’m nervous to use it because I don’t want to miss any payments and ruin my credit before I really know what that means.”

She described having the card as “a burden.”

“It’s annoying because I’m taking on bills for the first time in my life,” she says. “I’m living off campus and have to pay Internet, electric, water … ” She says she doesn’t feel equipped to handle a credit card bill, too.

Although their feelings about the cards differ now, for both Sarah and Zach, it was especially important to find the right time to start carrying a credit card. Both settled on senior year of college.

Zach says he considered opening a credit card for several years before doing so. He chose a card that charges zero APR (annual percentage rate) for the first year, so he figured senior year would be ideal: he would have a year to use the zero APR, but enough time to build credit before graduation.

“It’s kind of getting used to the system and really building that credit score,” he says. “I don’t know if you want to wait any longer (than I did).”

Sarah pointed out that waiting might be a good thing.

“Maybe I’m not as on the ball as I should be, but (credit card companies are) hoping people aren’t on the ball so they can make more money. Maybe that’s anti-establishment of me, but that’s how I feel,” she says.

My friend Jim, a recent college graduate who works for a major credit card company now, set some criteria for when is the right time to begin using a credit card.

“If you feel like you have the self-control to spend within your means, and be able to pay down the bill in full, then you’re ready,” he says. “If you don’t have that self-control or don’t know you if you know yourself well enough, maybe you’re not ready. But if you can do it, it’s something that’s necessary.”

It’s not the credit card company’s fault if you prove not ready, he says.

“They’re not forcing you to buy stuff. Just like professors aren’t forcing you to do homework. You do it because it’s the right thing to do,” he says. “Don’t spend money you can’t pay back.”

“Packing plastic” in the form of a credit card isn’t the right decision for every college student. As Jim said, I think it comes down to knowing ourselves and timing.

Using a credit card is a huge responsibility, so we have to do our research and make the decision that is right personally — not the decision that’s right for our friends.

If we only spend within our means and avoid debt, maybe in a few years, college students and credit cards will start sounding a little better together.

Maria LaMagna is an assistant editor at MoneyUnder30.com (@MoneyUnder30), a blog dedicated to helping 20- and 30-somethings manage money well. Maria is a senior at Northwestern University where she served as editor-in-chief of the university’s award-winning daily newspaper and studied for five months in Argentina.