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It’s been predicted that college enrollment will increase in America from 2014-2022, says a news report from Mintel. There has been an incline of diversity in college students, women making a mark in history to count for a majority of college attendees. When the amount of college students goes up, as does debt. Since the fiscal third quarter of 2011, student debt has increased from 8% to 10% as the overall consumer debt in the United States. This makes student debt comprise the largest debt (aside from mortgages) in America! Around 30% of students who depend on educational loans also have monthly loan payments that are more than $300 whereas 5% of those students have loans greater than $1,000. Students going to college have adjusted to effects of the recession in America, thus, changing their attitudes about financial services; half of these students do not think debt is necessary this day in age.
Recession changing attitudes
After seeing their parents suffer from recession, recent college students have more conservative views on investing their money. In fact, it is said that 73% of those say that this recession is a perfect demonstration as to why people should consider it vital to save up for retirement. In comparison, 74% feel as if the primary use of money should be put towards purchasing security. Good credit equals good security; 71% of students attending college in the US believe that good credit is a sign of utmost importance on your way to achieving financial success. 68% of females, 75% of males comprising of 71% of US college students say they won’t have a problem taking care of their every day finances. However, a whopping 58% admit that credit cards can e difficult to manage.
Robyn Kaiserman, a Financial Service Analyst for Mintel says, “Unfortunately, debt is considered necessary by today’s standards, and 52 percent of college students agree. Many (38 percent) find it acceptable if it is used to buy something that is really desired. However, the negative effects the recession had on their parents and families have left college students much more conservative with their finances. To most, money means security and college is a time for students to learn how to manage it so they can begin to exert their financial independence,”
Managing Financial Independence
Surprisingly given the advancement in technology over the years, college students do very little in the way of electronic banking that goes beyond account balances and transferring money in between accounts. While 64% of students (over six in ten students) own a Smartphone and have an app for their bank, only a small 18% of them actually use it for more than half of their transactions; only 39% use this app to deposit checks. To continue the statistics, 80% of students feel that it is best to bank with companies that have branching banks in nearby locations, all the while electronic services are expanding.
“Although some college students don’t use the word ‘budget,’ they seem to keep one, even if it isn’t a formal exercise. The fact that 71 percent feel confident in their abilities to manage their day-to-day finances indicates that they generally stay on top of their spending even if there are a few slip-ups here and there. Many use some type of technology to keep track of what they spend, whether it is an online function or a mobile one,” Kaiserman adds.
Statistically overwhelming, 56% of women and men, ages 18-23 seek financial service information from their older family members. Of that, 29% of women also look to friends for advice, while 37% of men will make the effort to take classes for financial service information.
While being on the road to building a retirement account, many men recognize that they have to take their time and money to invest in the stock market. This, however, is not what many females will realize. However, both males and females are paranoid of the market due to the recession’s harsh treatment on their family.
Males are more likely to have a checking or savings account in their name at an online inclusive bank and/or possess an investment account in their name, this oppose to females. 38% of makes are more likely to look to a bank or credit union monthly when saving money for the short and mid-term times comes to play than 31% of women. Men ages 21-23 are 62% more likely to own a credit care in their name. In comparison, men aged 18-20 are that of 28%. It shouldn’t be a surprise that men’s confidence in their bank or credit union is high when meeting their financial necessities whereas only 54% of men ages 18-20 are confident in the same thing.
Who’s Paying?
There is a common belief that many college students have expenses like tuition and cost of living paid for by their parents. However, only 14% of students get financial aid by their parents when dealing with college expenses; for women, this percentage increases slightly to 17%. This proves that college students show responsibility when handling expenses whether they take care of it on the spot or later in the form of paying off their debt. 60% of students (64% of women) actually pay for their own entertainment without the aid of a parent or guardian; 27% percent of those students have some or full responsibility in looking after their own college expenses.
Debt in the Long Terms
Generations before have faced the same long-term effects that today’s students fear. 71% of those who responded of ages 65+ believe retirement will be easy, comfortable living. However, that percentage goes down in those ages 55-64 who will be retiring in the near future. 32% of US consumers ages 55-65 agree that student loans are the number one reas