Teenage Marketing Unlimited reported in 2001 that teens spend an average of $104 per month, of which two-thirds is spent however they please. As a result, students apply for credit cards, thinking them to be an easy way to acquire goods and services without money. Accordingly, they do not think about how this affects their cash flow later on in life, if they abuse it.
Very few families and schools are teaching kids how to handle credit cards. Consequently, students often acquire the credit card, incur large account balances, and often do not pay them off. Unfortunately, very few understand that when they do not make payments on time or stop paying all together, they may not be able to acquire credit when they need it most, such as when they need to buy new cars or homes.
Credit Card Games
Two organizations have introduced credit card games which teach children credit card terms. Hasbro has created one called Boggle Credit Card, which is a word game that teaches the children the terminology associated with credit cards. While this is an excellent game to teach concepts, the children do not gain hands-on experience in using credit cards.
A new interactive credit card game targeted to 18-24 year olds has been reviewed by teens who complained that “There is no opportunity, for instance, to interact with other 'players' online or to compete against others – perhaps in a Monopoly-game type challenge.” The game was recently introduced by the Advertising Council and U.S. Treasury, and they admit that more work needs to be done to make the game a better learning experience.
Set Up to Fail
Giving teens the privilege of using credit cards without educating them on how to use them responsibly contributes to their financial problems later on in life and to the massive debt problems which have occurred in this country. If the banks gave more thought into teaching financial concepts to students instead of their bottom line profits, there would be less debt incurred by students at a young age.
Libby Wells reported in Bankrate.com that “Every other year, the group quizzes 12th-graders in public schools around the country on topics such as paying taxes, using credit cards and retirement savings. On average in 2006, participants answered only 52.4 percent of the questions correctly, a failing grade.” This means that more needs to be done to help students understand how to manage their money.
In conclusion, more research needs to be done to make credit card games more enjoyable as well as a better learning experience so that teens can learn how to manage debt.
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