As many students in the U.S. returned to college campuses last month, a survey found that around four in 10 of them were struggling with credit card debt.
Student loan debt is already a well-known issue, and the U.S. News and World Report survey indicates that this continues to be true for the current generation of college students. Nearly 30% of the survey respondents said their credit card debt exceeded $2,000.
According to a Bankrate report from this week, millennials are most likely to report student loan debt. An August report from Credit Karma found that while Gen X had the highest average amount of credit card debt, Gen Z had the highest growing amount.
“In the current survey, 42.1% of respondents say they have credit card debt,” said U.S. News & World Report. “In our 2022 survey, 46.1% reported having credit card debt, which means that student credit card debt decreased about 9% in the past year.”
More than 45% of college students said their credit card debt was the result of “nonessential purchases, such as dining, shopping and impulsive buying,” per the outlet. However, even more said that college essentials such as books (49.1%) and living expenses (48.5%) were the reason they got into debt.
Some of these debt holders likely have additional financial pressure coming up next month, when federal student loan payments start up again after a multi-year pause due to the COVID-19 pandemic. WBBM offered tips for borrowers this week.
Although college students have been racking up debt, their access to credit has become more limited.
“In our 2022 survey, more than 67% of students had a credit card account of their own,” said U.S. News & World Report. “The 2023 survey shows that 52.7% of respondents have a credit card in their own name, which is a nearly 22% decrease compared with the prior year.”
According to the outlet, that might be a result of a recent tightening of consumer credit.
This week, the Biden-Harris Administration “released final regulations that establish the most effective set of safeguards ever against unaffordable debt or insufficient earnings for postsecondary students,” to help improve the financial outlook for students and graduates in the U.S.