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Perspectives

Publication Date

5-1-2012

Abstract

This paper explores how access to credit, familiarity with debt and financial education, socialization agents and social identities, academic performance, and financial aid and family income influence college student spending habits and credit card debt. Being in credit card debt is common for many college students, but exploring the specific factors that contribute may help prevent future generations of students from participating in unhealthy spending habits and accumulating credit card debt. After a close comparison of eleven studies, I was able to conclude that easy access to credit cards makes students susceptible to accumulating debt. Students who perform poorly academically, are female, minorities, and who are older tend to be more likely to be in debt than other students. Family income and the amount of financial aid a student receives also affects their financial situation, as does the student’s own level of financial education, and financial socialization from parents. Although future research is needed on this topic, it is important to note that students’ social environment has an effect on their financial health.

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