College students are practicing responsible credit behavior, a recent survey shows.

Seventy-two percent of college students pay off their own credit card balances each month, while 18 percent have their parents pay it, according to the survey commissioned by Equifax.

In anticipation for college students’ returning to school, Equifax, a consumer credit reporting agency, commissioned a blind survey of more than 600 U.S. college students. The students surveyed were between the ages of 18 and 24, also known as Generation Z. Nearly 70 percent of college students have one or more credit cards.

The survey also shows college students are less likely to take advantage of free credit reports. Fewer than half of respondents, 43 percent, had seen their credit scores. However, 62 percent of respondents indicated they were aware a free copy of their credit reports is available to them, according to the survey.

Nancy Bistritz, Equifax’s director of public relations and communications, said the organization is glad to see members of Generation Z are paying their credit card bills in full every month. 

“We are really happy to see the younger generation is doing that or have a plan to do that,” Bistritz said.

John Petosa, Professor of Practice in the Martin J. Whitman School of Management at Syracuse University, said the study is a positive sign for future economic growth.

“If today’s students are careful with their credit, know how to use it, then they will be better able to participate immediately when they get their first jobs into our economy,” Petosa said. “They will be able to buy a house, car and other consumer durable products which helps keep our economy moving.” 

Suling Sun, a senior advertising major in the S.I. Newhouse School of Public Communications, recently got her first credit card. She said she doesn’t know anything about credit scores, only that she should pay her bill on time.

“I was excited that I have my first credit card,” Sun said. “I don’t know there is something called credit score that will be impacting me in so many ways.” 

Bistritz said their customer insights team was surprised so few students knew their credit scores. By federal law, you are entitled to a free credit report from AnnualCreditReport.com once a year, she said.

Bistritz said knowing credit scores are a good place to start. It’s like knowing how much you weigh, she said.

“It’s not going to tell you everything but at least tell you if you need to change certain habits or not,” Bistritz said. 

Petosa said he thinks today’s college students are more educated and keenly aware of the costs associated with developing their future given the cost of higher education.

“Being fiscally responsible and financially savvy is a great way to approach the remainder of their life.” Petosa said. “The clear lesson to be learned is pay your bills on time, do not take out more credit than you can use responsibly and you will be able to acquire virtually anything that you desire in the future.”

Bistritz said it’s important to build a good credit history to hit some of the typical milestones in life. College students may need a student loan, a car or a home at some point in their life, she added.

“One of the first and most important things we tell people time and time again is to pay your credit card on time every time,” Bistritz said. “The earlier you make good decisions and responsible credit behavior, the better position you will be to hit the milestone and get the best race.”

Published on September 5, 2016 at 11:11 pm

Contact Chieh: chchen@syr.edu