The combination of a college student and a credit card terrifies many parents. And it’s understandable, considering all of the parent-funded, plastic-facilitated shopping sprees we see depicted on reality TV and in the movies. But do actual college students really use credit so recklessly?
The statistics below will help you answer that question, as they illustrate the average balance held on student credit cards as well as student payment habits, the percentage of students using credit by grade level, how credit and debit card usage habits compare, and much more.
Ultimately, it’s important to wrap your head around student credit card use, as it is the most efficient way for young people to establish credit history and improve their credit score. Good credit is extremely important in the “real world,” as it affects your ability to get a loan, rent an apartment, lease a car, and even land certain jobs.
Average Credit Card Balances for Undergraduates
Credit Card Debt for Undergrads - $0 balances included
| Year | 2018 | 2015 | 2013 | 2012 | 2011 |
|---|---|---|---|---|---|
| Mean | $1,183 | $906 | $650 | $1,086 | $842 |
| Median | $400 | $300 | $179 | $255 | $289 |
- In 2018, 6% of college students have a zero balance and another 57% have less than $500 balance on their cards, while 3% carry a balance greater than $5,000
- The average balance across all cards is $1,183. However, with the high proportion of zero and low balances, the median balance is $400.
(Source: Sallie Mae, Majoring in Money)
Average Credit Card Debt for Undergrads - $0 included
- As the chart shows, undergraduate credit card balances averages have steadily declined between 2012 and 2013 driven primarily by an increase in grants and scholarships.
Credit Card Payment Habits for Students
- 97% of undergraduates are paying the minimum amount, or more on all of their credit cards each month.
(Source: Sallie Mae, Majoring in Money)
College Students’ Credit Card Payments by Purchase Category
- Students credit card usage has increase by 3% overall.
(Source: Sallie Mae, Majoring in Money)
Students with Credit Cards
- When asked, 57% of undergraduate students reported having a credit card in 2018, almost double compared to 2013 (30%).
- The ownership of credit cards by students differs according to region and race/ethnicity:
- Students living in the West are more likely to have credit cards (37%) than the students from Midwest (30%) or Northeast and South (26% and 27%, respectively);
- White students (33%) are more likely to have credit cards compared to only Hispanic (22%) and African-American (24%) students;
- Income level does not seem to influence the ownership of credit cards among students: thus 34% of high income students, 28% of middle-income students and 32% of low income students have credit cards.
(Source: Sallie Mae, Majoring in Money)
Students holding credit cards (segregated by level of education)
| Year | 2010 | 2011 | 2012 | 2013 |
|---|---|---|---|---|
| Freshman | 23% | 20% | 21% | 14% |
| Sophomore | 41% | 43% | 28% | 27% |
| Junior | 49% | 45% | 38% | 46% |
| Senior | 57% | 56% | 60% | 47% |
| Total | 42% | 40% | 35% | 30% |
(Source: Sallie Mae, How America Pays For College, 2013)
Students holding credit cards (segregated by level of education)
- Between 2010 and 2013 a decrease has been registered in the holding of credit cards by students, except in the case of Junior students.
Students Holding Credit Cards vs. Students Holding Debit Cards
| Year | 2010 | 2011 | 2012 | 2013 | 2015 | 2018 |
|---|---|---|---|---|---|---|
| Students holding at least one credit card | 42% | 40% | 35% | 30% | 56% | 57% |
| Students holding at least one debit card | N/A | 82% | 80% | 77% | 85% | 85% |
Students Holding Credit Cards vs. Students Holding Debit Cards
- The number of students holding at least one credit card has increased by 90% between 2013 - 2018.
- Debit cards remain by far the most popular choice in the case of American students with an average of 85% students owning at least one debit card.
- The decline in credit card use in 2013 was predominantly seen in freshmen students, with only 14% owning a credit card, compared with the 21% who owned one in 2012 and 23% in 2010.
(Source: Sallie Mae, How America Pays For College, Majoring in Money)