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Richard Piatt ReportingRather than get a hard lesson about bankruptcy in the future, Utah high school students are getting a lesson in financial literacy right now. The pitfalls of credit cards is an especially timely topic during the holiday season.
Finance experts say owing money to a credit card company is the worst kind of debt you can have -- high interest, easily accumulated -- yet 43 percent of Americans say they spend more than they make.
Credit card companies profit from that. Gross profits last year topped 18-billion dollars in the industry. 35 percent of that revenue was just from fees.
High school students have been a growing part of those profits. They can get credit easily. However, bankruptcies among young adults, 18-24 increased 96 per cent in the 1990's. The average college student graduates with 20-thousand dollars in student loan debt, and 3-thousand dollars in credit card debt.
All those grim numbers have sparked one man to do something.
John Ninfo, U.S. Bankruptcy Judge: "We couldn't get credit, but they can. But they don't know how to use it responsibly. And that's what we're here to teach them."
New York Bankruptcy judge John Ninfo talks to young people about Credit Abuse because these days they need to know it. Some East High school students say credit card companies are already after them.
Spencer Howarth, East High Student: "They're focusing in on a lot of people my age. I've had a lot of offers from credit card companies and stuff."
Temptations are plentiful in the 'buy now pay later' culture.
Addie VanBeuge, East High School Student: "A lot of high school students are irresponsible with their money. How bad is it? Oh really bad!"
Judge Ninfo's Credit Abuse Resistance Education talks about creating a budget, saving and debt consequences. Some students are already savvy to it all from their own early work experience.
Francina Huggins, East High School Student: "A lot of people carry around five dollars cash; and if they don't have enough money they just pull out their credit card. It's crazy. "
Abusing credit cards can ruin careers, futures, even entire families. Ninfo says he's telling young people the truth about debt because the credit card companies won't.
Utah public schools are also required to provide financial literacy programs to all students, starting with the class of 2008.
