The Debt Trap

Today, I was reading this New York Times article and thought back to my freshman year at college.  During “move-in” weekend and a number of other school events, there stood a table with some “cool” incentive (pens, backpacks, water bottles, etc.) in exchange for your life! Well, close to it.  A number of young, financially illiterate college students became victim to the world of credit card debt.  Big banking corporations such as Bank of America, the company featured in the article, have contracts with universities that benefit everyone, except for the student.  the article states,

“Bank of America’s relationship with the university extends well beyond marketing at sports events. The bank has an $8.4 million, seven-year contract with Michigan State giving it access to students’ names and addresses and use of the university’s logo. The more students who take the banks’ credit cards, the more money the university gets. Under certain circumstances, Michigan State even stands to receive more money if students carry a balance on these cards.”

Wow, really? Is it really ok to exploit students like this, well apparently some students are fighting back– as they should– some set up tables on campus to warn of the danger of debt and urge students to support limits on on-campus marketing.  Here’s some extra info on students’ credit card use from NYtimes.com

Just wondering, why don’t they offer some financial literacy seminars with this?

~ by blackalumnus on January 3, 2009.