The College Credit Card Scam

 It’s easy for parents to feel financially exploited when they send their kids off to college. The costs of a bachelor’s degree continues to soar far higher than the inflation rate.

But what many families hadn’t bargained on is that schools are making packs with the devil, a/k/a credit card companies, to ensure that their kids graduate with plastic debt.

BusinessWeek ran an expose recently that documented how universities and colleges are selling students’ personal information to major credit card companies, which then try to snare these young potential customers.

Some of the nation’s biggest schools, such as the Universities of Michigan, Minnesota and Florida State, have signed multi-million dollar credit card contracts. Bank of America, for instance, is giving the University of Michigan $25.5 million over 11 years. Florida State is pocketing $10.7 million over seven years.

It’s not just parents who should be concerned–actually revolted–by the willingness of colleges and universities to exploit their students. Here’s what a law professor at Ohio State said:

“It unethical for schools to allow a sophisticated industry to have access to their students, many of whom have graduated from high school without any financial education or literacy…The play field is grossly uneven.”

If you haven’t talked to your teenager about credit cards, initiate the conversation. It’s a lot easier talking about the dangers of plastic than those past conversations about the birds & the bees.

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