Sallie Mae, through its wholly owned subsidiary Nellie Mae, has published at regular intervals, since 1998, its analysis of credit card usage among college students at both the undergraduate and graduate levels. With today’s economic environment, information in this study continues to be relevant to students, educators, lenders and families. Particularly because college students generally produce a modicum of income, it is important to understand how they use credit, how much they are using, and the factors both attitudinal and situational that contribute to their decisions to use credit.
The primary data used for the study to assess how much credit students are using comes from credit bureau reports of students who have applied for credit based “alternative” or “private” student loans. In the early versions of the study, we analyzed only this credit bureau data for a randomly selected group of students at the start of the academic year. Beginning in 2004, we added a survey component to help uncover student attitudes about credit and the types of goods and services for which they are using credit.
Although we are continuing to provide information around the original core of the study, we have made additional variations in 2008. First, to boost the number of responses to the survey component, we sent the survey request to a larger pool of private loan applicants with similar selection criteria as the random sample, rather than restricting the survey to the credit bureau sample. Secondly, the core group was pulled from both Nellie Mae and Sallie Mae private loan applicants, rather than limiting the study pool to Nellie Mae private loan applicants. Thirdly, and perhaps the most significant change, is that we looked at students in the spring semester of the academic year rather than the fall semester. By doing so, we have a better picture of the credit card financial situation students are in after facing two semesters of college costs and living expenses.
A total of 1,200 students between the ages of 18 and 24 enrolled as undergraduate students in the spring of 2008 at public and private four year colleges and universities was included in the credit bureau analysis. The survey was sent by mail and email in June and July to this group, resulting in an 8 percent response rate. The online survey was also sent to an additional 4,600 undergraduates enrolled in the spring at four year colleges, ages 18 to 24, between August and September and received a 4 percent response rate.
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