NEW YORK—Nearly a third of college students say their families have been financially impacted by the COVID-19 pandemic, according to a new survey. As a result, 19% expect to take on more debt.
It appears some of that debt has appeared and will be appearing on credit cards. Half of college students, 53%, are charging purchases to two or more credit cards, according to AIG Retirement Services and EVERFI’s survey of over 20,000 college students nationwide.
That’s up from 41% last year and nearly double the 25% who reported using multiple credit cards in 2012, CNBC stated in its analysis.
“Many students will likely carry balances on these cards — 38% do not plan to pay off their bill each month. About 40% say they currently have at least $1,000 in credit card debt and 14% report having more than $5,000,” CNBC said.
“Of the different forms of debt, credit card debt is one of the worst,” said Rob Scheinerman, CEO of AIG Retirement Services. That’s because it’s typically very expensive — currently, the average interest rate is 15.91% — and there are no tax breaks like with student loans and mortgages.”