The fountain of debt
A recent poll has shown that 25% of 16 to 21 year olds have absolutely no idea about the consequences of debt and therefore, are likely to seek debt help before the age of 25.
The ignorance of these young people is quite disturbing as they are vulnerable to the temptations of credit card companies exploiting them. Many have no idea that a store card offers higher interest rates than a credit card and 75% have absolutely no idea what the term APR means. Asked if their parents ever helped them to understand financial matters, many shook their heads and stated that they coped alone and kept their debt worries to themselves. However, when interviewed, a third of parents expressed concerns that their children were living beyond their means but claimed that they found it very difficult to give them debt advice as their sons and daughters refused to listen.
Teenagers need to be made aware that they need to develop better debt management skills in order to cope with the added burden of student debt. There are plenty of free debt advice websites on the net which will assist young people with managing their finances and help them to maintain a clean credit rating.
The responsibility to save the younger generation from financial ruin must come from free student advice companies, parents and the creditors themselves. Lenders need to be more stringent in their lending plans, rather than handing out loans like candy. If lenders said ‘no’ once in a while to credit, then maybe youngsters would start to realise the importance of saving and working hard to acquire the things that they need rather than having everything handed to them on a plate. More needs to be done to help students to familiarise themselves with the financial jargon used when dealing with finance so as they can work out for themselves which forms of credit are economical and how they can calculate their spending.
Finance News posted on 30/05/2007 15:29:43
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