College credit card deals draw fire -- What's the solution?


Cozy relationships between big banks and universities are drawing the scrutiny of students, parents, and regulators, with New York Attorney General Andrew Cuomo investigating the matter. Hundreds of students at Portland State University protested the school's promotion of a bank account that was less attractive than those offered by competing institutions who weren't providing the school with cash.

I certainly agree with the students. The notion that schools are promoting financial products that aren't in the best interests of their students is despicable. But given the severe budget problems facing so many states, this is not something that's likely to change anytime soon.

The solution is education: As Beth Wechsler recently wrote on WalletPop, less than 20% of states currently have a personal finance education requirement. What this means is that, for many kids, the first bit of financial "advice" they receive is a shiny credit card offer -- bearing the logo of their new college.

If high schools focused on giving kids the firepower they need to fend off aggressive -- and often predatory -- financial services marketing, the effect of this marketing would be severely weakened. High school kids should be told about fees, compound interesting, FICO scores, investing, etc. They could also be shown videos featuring interviews with parents whose children committed suicide because of anxiety over credit card debt.