Are college students financially prepared?

College campuses across the nation are hotspots for meeting new people, gaining a valuable education, and creating lifelong memories. While the college experience can be a positive one, many students who are unprepared to deal with financial situations may find themselves in mounds of unwanted credit card debt. Will your child be financially prepared when he or she heads for campus this fall?

According to a study released by Nellie Mae, the average credit card debt held by undergraduate students is $2,169. The majority is using them to purchase school supplies, textbooks, and food. The percentage of undergraduates who will start the academic year with credit cards is around 76%.

It seems the biggest challenge for college students is just trying to keep their heads above water. In addition to tuition costs, there are living expenses, and if students do not have help from their parents to cover these items, they often end up putting them on credit cards and different forms of debt that have high interest rates. Moreover, collegians continuously are targeted by credit card companies, which provide them with easy access to opening new accounts. The companies push promotional freebies and/or sale discounts to students on campuses, at sporting events, and in shopping malls.

"Kids come to college and they see all these credit card opportunities in front of them," says Cinnamon Bock, who is enrolled at Cameron University, Lawton, Okla. "Students who don't know how to deal with financial situations go crazy with the availability of credit cards because they never had any guidance from their parents as to what credit can do. The problem starts even before these people ever get to college, and parents need to teach their children from a young age how credit can really ruin their lives if they don't use it wisely."

"A lot of students might be embarrassed to tell their parents that they're in debt and so the parents have no idea how much debt they have actually racked up during their college careers," points out Brenna Myers, a student at Purdue University, West Lafayette, Ind. "It's an embarrassing thing to tell your parents, especially if they taught you all your life how to manage your money and then you go to college and you come out with $3,000-$8,000 in debt."

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