Differences in Spending Habits and Credit Use of College Students

In a study of college students, affective credit attitude (feeling about using credit cards) and gender influenced college students' credit purchasing. Affective credit attitude predicted the purchase of clothing, electronics, entertainment, travel, gasoline, and food away from home. Females purchased clothing; males purchased electronics, entertainment, and food away from home. Gender was more influential in predicting financial management practices than was affective credit attitude, with female students employing a greater number of financial practices. A path analysis model showed gender differences in the relationship between financial practices, financial stress, affective credit attitude, and the number of credit cards with a balance.     

Consumers’ Use of Credit Cards: Store Credit Card Usage as an Alternative Payment and Financing Medium

This paper investigates consumers’ use of store-issued credit cards with particular attention to their function as an alternative payment and financing medium. Using 1998 Survey of Consumer Finances data, the researchers found that credit availability through bankcards is negatively correlated with consumers’ use of store cards as a financing medium, suggesting the role of store cards as a supplementary credit line. A negative relationship is also found to exist between consumers’ bankcard usage and their use of store cards for a transaction purpose, indicating that store cards function as a substitute payment medium. Consumers’ usage of store cards varies according to function and is related to a number of variables, including the use of bank cards, credit history, attitude toward credit, income, education, and ethnicity.     

Differences in the use of bank and retail credit cards in the U.S.A.

Data from the 1989 Survey of Consumer Finances¹ were analysed to find factors related to credit card use in U.S. households. Factors associated with the probability of using only retail cards were being a female-headed household, being older and being in a blue collar occupation. The use of bank cards only was associated with male heads of households, renting and a negative attitude toward credit. The use of both retail and bank cards was associated with a positive attitude toward credit, being in a professional or managerial occupation and home ownership. The results provide insight into credit card use and should help target educational efforts to those most likely to experience debt problems related to extensive use of credit cards.     

Money management practices influencing household asset ownership

The purpose of this research is to describe the types and amounts of assets owned by households, and to determine socio-demographic variables and money management practices that influence the household's total asset ownership. The data used for this study are from a survey conducted during the winter of 1982. Definite patterns of financial asset ownership emerged. A majority, 70% or more, of the households owned current and savings accounts, and cars and real estate. A minority, 30% or less, owned certificates of deposit, mutual funds, stocks, bonds and individual retirement accounts. Age, net income and housing tenure were significant socio-demographic variables in explaining variation in total asset ownership among households. Only two money management practices, i.e. number of credit cards owned and the amount the manager felt comfortable charging on these cards, were significant in explaining variations in the amount of total assets owned by a household.     

Quebec young adults’ use of and knowledge of credit

This research aimed to study young adults’ use of and knowledge of credit. A large representative sample of Quebec young adults aged 18–29 years participated in a telephone survey. Results reveal that their use of credit has increased remarkably over the last decade. The mean score on the credit knowledge scale used in this study is 49.4% for the entire group. Ordinary least squares (OLS) regression analysis show that credit knowledge is positively related to personal income, number of debts, amount of total debt, number of credit cards and favourable attitude towards credit and debts. Young adults reporting either personal experience or family and relatives as their main source of learning about personal finances were found to have a lower level of knowledge about credit in general than those reporting having learned of this subject from courses, the media or financial counsellors. The learning of basic knowledge about credit and personal finances, with stress on the sensible use of credit, should be part of the educational agenda for young consumers.     

Credit Card Use and Compulsive Buying Behavior

ABSTRACT

Compulsive buying behavior is a negative form of behavior that leads to overspending. In the current study, the author examines the applicability of a compulsive buying behavior scale developed by Valence et al. (1988) with Indian consumers. Compulsive buyers are likely to relate money to power, success, and status. Compulsive buyers perceive their purchases as a way of overcoming negative self-esteem and anxiety. The influence of consumers’ attitude toward credit cards, demographic factors, and credit card use on compulsive buying was studied. The findings suggest the compulsive behavior scale should be modified in the Indian context. Age, income, education, and marital status influence compulsive buying. Consumers’ attitude toward credit cards did not affect compulsive buying.     

How Does Financial Literacy Impact Attitude Toward Student Loan Providers?

ABSTRACT

We examined whether financial literacy changes college students' assessments of their student-loan providers. As predictors in our backward regression, we included (a) financial literacy, (b) perceived importance of loan, (c) satisfaction with college, (d) financial optimism, (e) experience using credit cards, and (f) perceived importance of decisions about credit cards. We also included two-way interactions between financial literacy and the other variables. Our regression explained about 24% of the variance in the dependent variable. Our results indicated that financial literacy was a significant predictor of attitude toward the student loan provider—but only in the interaction terms.     

Time to Cut Up Those Debit Cards? Effect of Payment Mode on Willingness to Spend

Financial industry data indicate that consumers increasingly prefer debit cards over credit cards, especially as a means of enforcing financial self-discipline. Given prior research suggesting that credit cards act as spending facilitating stimuli, this move toward reduced credit card use would appear to be in the right direction. Ironically, however, the same logos that were implicated in facilitating spending with credit cards are the logos that appear on debit cards. In what should serve as an eye-opener to consumers, it is found that exposure to debit card logos does result in an increased willingness to spend, similar to credit cards.     

Credit cards in a Chinese cultural context—The young, affluent Chinese as early adopters

This research examines the attitudes of early adopters towards holding and using credit cards, especially how the ‘young and affluent Chinese’ view credit cards, in the Chinese cultural context. The findings indicate that frequent users of credit cards are more inclined to agree that: they display traits of new product adopters; credit cards offer them greater convenience; and others regard them as being more au-fait with technology, and more financially aware. The research also reveals a fear of loss of financial control when using credit cards that may impede its rate of adoption in China.     

The Employment Act, 1980

A research model was developed to explain the probability of households using major types of credit cards, and empirical tests were performed for differences among the utilisation behaviours of five types of credit card. Many differences were revealed, and support was shown for the overall hypothesis of differences among the types of credit card with regard to utilisation behaviour. These demonstrated differences implied that credit grantors and researchers should recognise that the behaviour of consumers in using credit cards depends on the type of credit card. Separate analyses by type of card are warranted so that the true effects of selected consumer characteristics can be examined.     

Changes over Time in College Student Credit Card Attitudes and Debt: Evidence from One Campus

Over the past 10 years, both public awareness of, and research about, college student credit card debt have increased. This study examined changes in college students' debt and possession of credit cards, as well as attitudes toward debt and credit cards over that time at one American college campus. Results indicate that the number of credit cards held and the amount of credit card debt both decreased in the time following the 2009 Credit CARD Act. Attitudes toward debt gradually became more negative over the past 10 years, whereas perceived personal financial well‐being increased. Although debt is decreasing, some students continue to report high levels of debt and correlates of higher levels of debt continue to include year in school, decreased ability to delay gratification, and lower levels of perceived financial well‐being. Overall, it appears that students' relationship with credit cards is changing, but many still have difficulty managing credit.     

Social Networks and Credit Card Overspending Among Young Adult Consumers

Research that has looked at the reasons why young individuals overspend using their credit cards has not paid attention to the perceptions that they have about important others' credit card debt, their expectations as to how much to spend when they consume in the presence of them, and how the strength of the social relationships within their social network potentially influences the extent to which they overspend using their credit cards. A survey of 225 US university students composing a culturally diverse sample revealed that these social norms and network variables have interactive effects on credit card overspending. Specifically, the results show that the perceptions that young adult consumers have about important others' credit card debt impact their overspending using credit cards when they feel that they are expected to consume at the same level as important others in shared experiences, and when they are strongly connected to these individuals.     

Brett Williams. Debt for Sale: A Social History of the Credit Trap. Philadelphia: University of Pennsylvania Press, 2004. 154 pp. ISBN 0-8122-3817-6, $24.95 (cloth).

This volume covers a social history of modern consumer credit,specifically, credit card debt, pawnshops, and storefronts thatoffer check-cashing services and paycheck loans. Consumer creditis largely a product of the past half century. Diners Club issuedits first credit cards in 1951, and Carte Blanche, AmericanExpress, and other entities soon followed suit. In the 1970sthe advent of computers and the deregulation of banking resultedin an explosion in the use of credit cards. Initially, credit     

Credit cards,new technology and consumer debt*

There has been a rapid expansion in consumer indebtedness in the U.K. The amount of consumer debt has doubled in real terms during the last 10 years. The majority of consumers are able to cope with their debt repayments, but there are a significant number of credit casualties, often burdened with multiple debts. Credit cards have played a significant but not overwhelming part in this increase in debt. There are now 62 bank credit cards for every 100 adults in the U.K., a much higher incidence than in any other European country. Credit cards have been aggressively marketed and sold, and it is possible that they will now move downmarket, to consumers in lower income groups. This possibility highlights the need for a major consumer education campaign on the cost of credit. U.K. consumers' knowledge of and ability to compare credit interest rates is poor, especially among lower income consumers who are most at risk.     

Credit Cards: Transactional Convenience or Debt‐Trap?

We survey individuals on their credit card usage. Contrary to popular press, most credit card holders use credit cards in a responsible manner. They tend to use credit cards for transaction convenience and pay little interest. Only a minor subset of people uses credit cards to access expensive credit, with only 7% of credit card holders in our sample never paying the balance in full. Credit card debt is more common among older, less financially literate, and less trusting respondents. Even individuals with credit card debt are well aware about its costs and are likely to make informed financial choices.     

Effects of social demographic attributes,knowledge about credit cards and perceived lifestyle outcomes on credit card usage

The aim of this paper is to identify and assess the effects of credit card users' demographic and socio‐economic characteristics, knowledge about credit cards, and perceived lifestyle outcomes of the credit card usage on credit card usage practices. A sample of 177 individuals in Sri Lanka who possess Visa, MasterCard or American Express credit cards responded to the survey. The hypothesized relationships were examined by means of path analysis. The findings offer implications for research and practice.     

Do Equally Owned Small Businesses Have Equal Access to Credit?

Previous research in small-business financing has generally ignored those businesses owned equally by males and females. The rationale has been that such businesses share the characteristics of both types of owners and would confound any gender-based differences. This paper presents an empirical study in which the credit access experiences of equally owned small businesses are compared to those of their female- and male-owned entrepreneurial counterparts. Various measures of credit constraints are introduced that suggest that equally owned businesses often do experience larger constraints than male-owned businesses and smaller constraints than female-owned businesses, when all credit applicants are considered. However, the results are more mixed in comparisons of successful applicants’ constraints. A different approach from that of existing research is then used to study exactly how equally owned small businesses’ experiences are unique, rather than merely whether they differ from those of their counterparts. The evidence indicates that different factors are determining the credit application outcomes of all three ownership groups. Where similar determinants are found, equally owned businesses are influenced in a manner more similar to male-owned small businesses. The results show that equally owned small businesses’ credit access experience is not equally balanced between those of their counterparts.      

Young adults’ attitudes towards credit

This research project was undertaken to study young adults’ attitudes towards credit in general. A sample of 980 young Canadian adults, ages 18–29, participated in a telephone survey. Results reveal that they recognize both the advantages and the risks associated with credit. Regression analysis shows that attitudes towards credit is positively related to education, the number of credit cards held and knowledge of credit, but negatively related to the number of children. The young adults who reported that their parents and friends are heavy credit users are more likely to have positive attitudes towards credit. No link was found with the participants’ level of debt.