®. Conducted each Spring and Fall semester Conducted each Spring and Fall semester On campus,...

STUDENT MONITORFINANCIAL SERVICES

SPRING 2012

© 2012 STUDENT MONITOR LLC550 North Maple Ave., Ridgewood, NJ 07450All Rights Reserved, Unauthorized Use Prohibited

®

Spring 2012 © STUDENT MONITOR LLC – All Rights Reserved, Unauthorized Use Prohibited

2

METHODOLOGY Conducted each Spring and Fall semester

On campus, one-on-one intercepts conducted by professional interviewers during the two week period March 12th to 26th, 2012

1,200 Four Year full-time undergrads (Representative sample, 100 campuses stratified by Enrollment, Type, Location (Census Region/Division)

Margin of error +/- 2.4%


3

COLLEGE STUDENT POPULATION

Two Year Full-time15%

Two Year Part-time25%

Four Year Part-time10%

Four Year Full-time36%

Grad Part-time8%

Grad Full-time6%


4

DEMOGRAPHICS

Compared to last year, increases are seen for monthly discretionary spending, annual personal earnings and the amount of money students receive from home

Monthly discretionary spending: $225 (+15%) Annual personal earnings: $4,809 (+15%) 54% get money from home averaging $315

monthly (+19%) 9% are employed full-time and 46% are employed

part-time and 6% have an internship during the school year

Average age: 20.7 Family HH income: $88,671


5

TOP ACADEMIC MAJORSBusiness,

followed by Engineering, Health Professions, Biology, Education and Psychology continue to be the most common majors

Total%

Male%

Female%

Business 11 13 9Engineering 7 10 3Health Professions 7 4 9Biology 6 5 8Education 5 2 7Psychology 5 4 7Communications 4 3 4Accounting 4 5 3Social Sciences/History 3 2 4Marketing 3 3 3Criminal Justice 3 3 3Pre-Med 3 3 3Computer Science 3 6 1


6

STUDENT BANKING - 63% have a checking account in their own name, (average balance $631, down 2%

from $647 last year)

42% (up somewhat from 38% last year) were offered a credit card when they opened their checking account and 28% accepted the offer and received the card

46% have a savings account in their own name (48% last year, average balance $1,039 compared to $1,127 last year)

28% (20% last year) were offered a credit card when they opened their savings account and 26% (30% last year) accepted the offer and received the card

38% have an ATM card in their own name (44% last year) and 64% have a debit or check card in their own name

57% of those with a Campus Card have a card that acts as an ID, provides building access and also serves as a payment card

85% use their computer for online banking or financial services transactions

SUMMARY FINDINGS:


7

PAYMENT METHODS - 37% of monthly spending is cash-based, 55% with an ATM/debit or check card , 23%

with a credit card and 5% with a school issued Campus Card

73% (74% last year) use their ATM card to pay for purchases and 84% of these students use their card to pay for purchases weekly or more often. Students using their ATM card to pay for purchases use their card an average of 18 times monthly (up from 14 times last year)

64% have a debit or check card in their own name (compared to 62% last year. Nearly half are Bank of America (21%), Chase (15%) or Wells Fargo (12%) issued check cards

79% of students with a debit/check card use their card to pay for purchases weekly or more often. Students using their debit/check card to pay for purchases use their card an average of 17 times monthly

By wide margin “Cash back” (58%) is the most commonly reported reward students are interested in receiving from the issuer of their debit/check card (17% mention “Entertainment” and 15% mention “Rebates on gas purchases”)

SUMMARY FINDINGS:


8

CREDIT CARDS - “Card in own name requiring proof of income” (43%) is the type of credit card most

students prefer

27% have a general purpose credit card in their own name (VISA, MasterCard, Discover or American Express). 18% of all students have a VISA card in their own name, 8% MasterCard, 2% American Express and 3% Discover

The average student cardholder has 1.4 cards (1.3 last year), 70% have one card, 23% have two cards and 7% have three or more cards. 7% (down from 14% two years ago) report that their parents “Don’t know” they have a credit card.

Chase (19%), Bank of America (17%), and Wells Fargo (15%) are the largest issuers of all VISA and MasterCard credit cards in students’ own name. Chase (23%) is the largest VISA issuer and Bank of America and Capital One (each 14%) are the largest MasterCard issuers

67% of are satisfied with their credit limit and 78% received a credit limit increase in the past year

SUMMARY FINDINGS:


9

CREDIT CARDS (continued) -

88% use their credit card monthly or more often spending an average of $205 based on an average of 11 transactions

70% (compared to last year’s 68% finding) pay their bill in full each month (among the 30% who carry a balance forward, the average balance is $641, down 8% from $695 last year)

The largest share acquired their credit card by “Applying in person at my bank” (also their preferred method of acquiring a credit card

62% (up from last year’s 56%) acquired their first card before starting college

67% believe they or their parents and family have the primary responsibility to educate them about managing their finances

Somewhat more students (53%%) believe they received enough credit education from the issuer of their credit card as those who did not (47%)

About one in four students (26%) are interested in obtaining a credit card in the next year

SUMMARY FINDINGS:


10

STUDENT LOANS -“Parents” (73%) and “School’s financial aid office” 58% continue to be the most

influential sources of information about paying for college (27% identify their bank)

68% of students expect to have undergrad student loan debt averaging $29,996 and more than $34,000 among students attending Private schools

60% of student loan debt is from government sources, 22% (20% last year) private, bank loans and 21% (20% last year) are loans direct from their school. More than half (55%) plan to consolidate their loans

54% (down somewhat from 61% last year and 65% two years ago) are “Confident in my ability to repay student loans according to the loan’s terms and conditions”

INSURANCE AND INVESTMENT PRODUCTS -“Automobile insurance” is the most commonly owned insurance or investment product

and the product students are most likely to purchase in the next year

11% “Don’t have” health insurance (64% have health insurance via their parents policy)

SUMMARY FINDINGS:


11

Secured credit cards

Checking

Credit cards

Student loans

Savings

Credit

Investments

38%

40%

40%

41%

43%

45%

49%

INTEREST IN INCREASING KNOWLEDGE/LITERACY“VERY/SOMEWHAT INTERESTED”

Students report the highest level of interest in increasing their knowledge and literacy about “Investments” (49%) and the lowest level of interest in “Secured credit cards” (38%)


12

Offers a cool card design or unique card shape

Provides budget controls and alerts, so you can effectively manage what you spend.

Access to merchants that require a credit card like hotels, car rental, online shopping, etc.

Provides merchant savings offers (discounts on music downloads, mbile phones, movie tickets, theme parks, concerts, etc.

Provides credit education programs for students

Offers a rewards program (merchandise, travel or gift certificate

Provides a "limit-control" in that you can't spend more than you have in your savings account

Provides a reward or student only pricing

Builds a credit history

24%

33%

42%

45%

46%

47%

48%

49%

68%

IMPORTANCE OF PAYMENT CARD FEATURES“VERY/SOMEWHAT IMPORTANT”

“Builds a credit history” (68%) is the highest rated feature of a payment card

“Cool design or unique card shape” (24%) is the lowest rated feature of a payment card


13

MONTHLY PURCHASES & SPENDING

Payment Method

Category PurchasersMonthly

PurchasesMonthlySpending Cash

CreditCard

Parent’sCredit Card

ATM, Check orDebit Card

Bookstore (off campus) 34% 3.8 $29 29% 12% 8% 48%

Bookstore (on campus) 44% 3.8 $41 27% 11% 9% 44%

Convenience store (off campus) 70% 7.2 $28 35% 11% 5% 46%

Convenience store (on campus) 51% 6.7 $26 31% 10% 5% 45%

Department store 54% 4.0 $45 27% 14% 6% 51%

Fast food restaurant 81% 7.2 $32 36% 11% 4% 45%

Gas station 71% 5.9 $75 29% 14% 7% 48%

Movie theater 57% 2.3 $19 35% 11% 5% 46%

Online purchases 54% 3.5 $45 19% 16% 8% 53%

Other retail/specialty store 46% 3.7 $32 28% 12% 7% 51%

Other stores on campus 33% 4.4 $21 30% 11% 5% 48%

Restaurant 65% 3.5 $37 32% 12% 5% 49%

Supermarket 76% 5.1 $74 29% 13% 5% 50%


14

Online person-to-person payment sys-tem (Paypal)

1%Check

3%

Prepaid card with VISA, MC, Discover or AMEX logo

3%School issued Campus

Card5%

Your parent's credit card8%

Your credit card15%

Cash37%

ATM card/debit card/check card

55%

SHARE OF MONTHLY SPENDING BY METHOD

“ATM card/debit or check card” (55%, up from 44% last year) accounts for the largest share of monthly spending

“Cash” (37%, down from 42% last year) accounts for the second highest share of monthly spending


15

Obtaining renter's insurance

Opening a credit card account

Obtaining a student loan

Obtaining auto insurance

Acquiring a mobile phone service provider

Opening a checking account

Obtaining health insurance

28%

37%

44%

51%

52%

53%

54%

INFLUENCE OF PARENTS WHEN . . .“GREAT/SOME INFLUENCE”

Students report parents have their greatest level of influence when “Obtaining health insurance (54%, up from 49% last year)

Parents have comparatively less influence when “Opening a credit card account (37%) or “Obtaining renter’s insurance” (28%)


16

I would be interested in advice provided by my bank to help me cope with the challenges of this economy

The student loan application process is too complicated

I would be interested in learning about all of the products my bank has to offer at one time

Compared to this time last year, I am more likely to need a student loan to stay in school

I am responsible enough to have my own credit card but I have too much anxiety about getting into debt

I would be interested in understanding how insurance can help control risks such as medical costs or repaying student loans

There isn't as much of a need for a credit card as long as you can use a debit card or cash

I have a very good understanding of how to manage my credit

I am aware of all the potential fees my bank may charge me

I have a very good undestanding of how to build good credit

I have access to enough financial education around understanding the value of credit, best way to build credit and manage it

I have a very good undertanding of the value of having good credit

I'm concerned about managing my money in school

I'm concerned about managing my money after graduation

Financial literacy is more important now that I'm in college

34%35%36%38%

42%43%43%

46%48%49%

52%55%57%

61%62%

AGREEMENT WITH STATEMENTS“STRONGLY/SOMEWHAT AGREE”


17

300 to 499 (Bad)1%

500 to 579 (Poor)1%

580 to 619 (Low) 1%

620 to 679 (Avg)2% 680 to 699 (Good)

1%

700 to 850 (Very good)

9%

Don't know85%

STUDENTS’ CREDIT SCORES

85% of students (including 82%) of Seniors) “Don’t know” what their credit score is

Including this 85%, about one in ten (9%) report their credit score is between 700 to 850 (categorized as “Very” good”)

3% report their credit score falls into the 300 to 619 range

18


IMPORTANCE/DESCRIPTION OF CREDIT SCORE

Very im-portant

67%

Somewhat important

20%

Neither9%

Somewhat unimportant2%

Very unimportant2%

Importance of Score

Excellent9%

Above average

15%

Average19%

Below average4%

Poor2%

Don't know51%

Description of Score

Nearly seven in ten (67%) believe a good credit score is “Very important” while 20% believe it is “Somewhat

important”

Among the 49% describing their credit score, nearly half (49%) describe their score as “Above average” or

“Excellent”


19

Don't want to receive

No preference

Customer service representative

Automated call from credit card company

Some other way

eMail from credit monitoring provider

In statement letter

Online from credit monitoring provider

Mobile app on phone

eMail from credit card provider

Online from credit card company's site

Direct mail

12%

32%

1%

1%

1%

2%

3%

4%

6%

6%

16%

16%

PREFERRED WAY TO RECEIVE CREDIT SCORE

88% of students are interested in receiving their credit score

No single preferred method of receiving their credit score is mentioned by more than 18% of those interested in receiving their credit score


20

PRIMARY RESPONSIBILITY FOR EDUCATION ABOUT MANAGING FINANCES Nearly two in

three students believe they (35%) or their parents (32%) have the primary responsibility for educating them about managing finances

About one in eight (13%) identify their bank

Don't know

Other

My elementary/junior high school

My credit card company

My high school

My college or university

My bank

My parents or family

Myself

6%

3%

1%

2%

3%

6%

13%

32%

35%


21

Apply for an auto loanAccess educational resources

Learn about managing financesLearn about bank offersApply for a student loan

Create a budgetApply for a credit card

Contact bank's customer serviceOther banking services

Find branch locationFind ATM's

Pay a bill onlineTransfer funds from one account to another

Check transaction activityCheck account balance

2%3%3%4%5%5%7%

11%12%

19%21%21%

29%46%

72%

REASONS FOR VISITING BANK’S WEBSITE (USING A COMPUTER, NOT A SMARTPHONE)


22

IMPORTANCE OF HAVING ALL FINANCIAL PRODUCTS WITH ONE INSTITUTION

About three in four students (76%) believe it is as least “Somewhat important” to have all of their financial products with one institution

Nearly half (47%) believe it to be “Very important”

Very impor-

tant47%

Somewhat important29%

Neither 34%

Somewhat unimportant

5%

Very unimportant7%


23

CHECKING ACCOUNTS

More than six in ten (63% compared to last year’s 65%) report they have a checking account in their own name

Have in own name

63%

Joint ac-count with

parents16%

Parents manage account

5%

Don't have checking account

15%


24

I'm actually managing my checking account more responsibly than my parents believe I am

My parents had a major influence on my decision WHERE to open my checking account

My parents had a major influence on my decision to open my own checking account

My parents did not discourage me from opening my own checking account

My parents think I can handle the responsibility of my own checking account

48%

51%

55%

70%

72%

AGREEMENT WITH STATEMENTS ABOUT CHECKING ACCOUNTS - “STRONGLY/SOMEWHAT AGREE”


25

BB&T

SunTrust

TD Bank

HSBC

Regions

Citizens

US Bank

Wells Fargo

Bank of America

1%1%1%1%1%1%1%

2%2%

3%3%

4%4%

7%11%

17%21%

WHERE STUDENTS HAVE THEIR CHECKING ACCOUNT

About half (49%) of students’ checking accounts are Bank of America (21%), Chase (17%) or Wells Fargo (11%) checking accounts


26

WHEN CHECKING ACCOUNT WAS OPENED

Including the 3% of students who “Don’t know” when they opened their checking account, nearly three in four (74%) opened their account before starting college

Don't know

Senior year of college

Junior year of college or summer after

Sophomore year of college or summer after

Freshman year of college or summer after

After high school but before college

High school or earlier

3%

1%

3%

5%

15%

26%

48%


27

HOW CHECKING ACCOUNT WAS OPENED

81% opened their checking account by visiting a branch with a family member or by themselves

Don't know

Other

I opened the account using the bank's website

I opened the account at school during a bank sponsored event

I visited the bank branch with a friend that banked there

I visited the bank branch on my own

I visited the bank branch with a parent or relative

5%

3%

3%

3%

6%

28%

53%


28

WHAT WAS IMPORTANT WHEN SELECTING WHERE TO OPEN CHECKING ACCOUNT “Located near my

parents’ home” was the most important criteria used by students when selecting where to open their checking account (more important than “Reputation” or “Reasonable pricing and fees”

Other

Visited blogs to see what others had to say

Talked to a bank rep at school during an event

Used the bank's website to do research

Referred by friends or fellow students

Bank offered checking specifically for students

Good online banking capabilities

Reasonable pricing and fees

Reputation for good service

Located near the campus

Referred by a parent or other family member

Located near my parent's home

9%

1%

2%

6%

9%

12%

14%

20%

24%

30%

30%

40%


29

OVERDRAFT PROTECTION,OFFERED CREDIT CARD

59% were offered overdraft protection when they opened their checking account (another 26% “Don’t know)

56% have overdraft protection

“Transfer from a saving account” (63%) is the most common type of overdraft protection reported

“Avoid bounced check fees” (52%) and “Avoid potential negative reports to credit reporting agencies” (29%) are the most commonly reported benefits of overdraft protection

42% were offered a credit card when they opened their checking account (28% of these students accepted the offer)


30

NUMBER OF CHECKS WRITTEN,AVERAGE CHECKING ACCOUNT BALANCE

64% don’t write any paper checks in a typical month

Among the 36% who write papers checks, in a typical month this group writes 2.5 paper checks

Students report an average monthly checking account balance of $631 (15% report $15 or less)


31

TEXT/EMAIL ALERTS

More than four in ten (41%) report their bank offers text and/or email alerts and they use these alerts

One in four (24%) report the availability of these alerts but do not use them

Offered and used

41%

Don’t know if offered28%

Offered but not

used24%

Not offered7%


32

INTEREST IN RECEIVING TEXT/EMAIL ALERTS

More than half (52%) are at least “Somewhat interested” in receiving text or email alerts from their bank

About three in ten (29%) report being uninterested

Very in-terested

25%

Somewhat interested

27%Neither

18%

Somewhat un-interested

9%

Not all all interested

20%


33

ALERTS USED

Among the 53% of students who are offered and use alerts, 70% use balance alerts while 30% use general banking, spending or bill payments alerts

Not offered

None of these

Budget Alerts

Bill Payment Alerts

Spending Alerts

General Banking Alerts

Balance Alerts

8%

39%

8%

15%

16%

16%

37%


34

SAVINGS ACCOUNTS

More than four in ten (46% and similar to last year’s 48%) have a savings account in their own name

33% (34% last year) don’t have a savings account

Have in own name

46%

Joint account with parents13%

Parents manage account

9%

Don't have savings account

33%


35

SAVINGS ACCOUNT

28% of those with a savings account in their own name were offered a credit card when they opened their savings account

Among the 28% offered a credit card, 26% accepted the offer

Students with a savings account report an average monthly balance of $1,039 (10% report a balance of $50 or less)


36

ATM CARD 38% report they have a ATM card 75% of this group can make a purchase using a PIN

number 73% can withdraw cash from their account, 52% can

make a deposit. “Get cash” (81%) is the most commonly reported transaction

47% use their card weekly or more often for banking transactions

73% use their card to make purchases (84% of this group use their card weekly or more often to pay for purchases using it an average of 18 times monthly


37

DEBIT/CHECK CARD

64% report they have a Debit/Check card 86% of this group reports their card has a VISA, MC

logo on it 57% of this group can make a purchase using a PIN

number 59% can withdraw cash from their account, 49% can

make a deposit 48% can sign for a purchase using their debit/check

card 79% use their card weekly or more often to make a

purchase using it an average of 17 times monthly


38

BB&TUSAA

TCFWachovia

CitibankTD Bank

Key BankHSBC

SunTrustCapital One

RegionsCitizens

PNCFifth Third

US BankCredit UnionWells Fargo

ChaseBank of America

1%1%1%1%1%1%1%1%

2%2%2%2%

3%4%4%

6%12%

15%21%

ISSUER OF DEBIT/CHECK CARD

Nearly half of all students’ debit or check cards are issued by Bank of America (21%), Chase (15%) or Wells Fargo (12%)


39

None

Other

Video downloads

Wellness

Points toward consumer electronics

Event/concert tickets

Music downloads

Points toward gift certificates/cards

Travel

Entertainment (concerts, movies, events)

7%7%

4%1%1%2%2%

4%4%5%5%5%6%6%7%

10%10%

15%17%

58%

REWARDS INTERESTED IN RECEIVING FROM DEBIT/CHECK CARD

By a wide margin, “Cash back” (58%) is the debit/check card reward students are most interested in receiving

About one in six mention “Entertainment” or “Rebates on gas purchases” (15%)


40

BANKING ONLINE

69% are interested in banking online

85% bank online and among this group the most common transactions are;

“Check balances” (86%)“Check transactions” (60%)“Pay bills” (38%)“Transfer funds between accounts” (31%)“Find out if a check has cleared” (22%)


41

Automatic recurring payments

Transaction alerts

Free credit score tracking

Payment alerts

Payment confirmation

Credit limit alerts

Extended warranty, purchase protection

Faster at the register, always available

No need to worry about carrying and losing cash

Rewards on purchases such points or cash back

Use where other payment choices are not accepted

Track and review spending with statement

Additional purchasing power for the unexpected

Start building a credit history

40%40%

43%43%43%44%44%45%

48%48%50%52%54%

60%

IMPORTANCE OF REASONS FOR HAVING A CREDIT CARD

“Start building a credit history” (60%) is the highest rated reason for having a credit card

More than half mention “Additional purchasing power for the unexpected” or “track and review spending with statement”


42

IF RECEIVED FIRST CREDIT CARD TOMORROW . . .

62% report they would shift 1% or more of their spending from other payment methods to the credit card

Among this 62%, on average students would shift 31% of their spending from other payment methods to the credit card

24% would use their credit card weekly or more often and 34% would use their credit card “a couple times a year” or “Never/almost never”

Among those who would use the card, in a typical month they would charge $164 to their card


43

Card in your own name cosigned by parent

Card that is an authorized user of your parent's card

Card that requires you to establish and maintain a savings account

Card in own name requiring proof of income

17%

18%

23%

43%

PREFERRED CREDIT CARD

Students far prefer a credit card independent of their parents’ involvement

By a wide margin a “Card in own name requiring proof of income” is the most preferred type of credit card


44

Obtain a credit card as authorized user of parent's card

Apply for a credit card in own name cosigned by parent

Apply for a credit card that requires opening a savings account to secure card

Apply for different credit card

Use debit card, apply for credit card after graduation

11%

13%

14%

29%

33%

REACTION TO BEING DECLINED OR RECEIVING INSUFFICIENT CREDIT LINE

“Use debit card, apply for a credit card after graduation” (33%) is students’ most common response to be declined or offered an insufficient credit line

A similar number of students (29%) would “apply for a different card”


45

Payment anxiety or afraid might not be able to make monthly

payments

Spending beyond my means and getting into debt

Potential responsibility for paying charges that are not yours

Identify theft

59%

63%

65%

68%

CONCERNS ABOUT HAVING A CREDIT CARD

More than half of all students express one or more concerns about having a credit card

“Identity theft” (68%) is the most commonly mentioned concern

Somewhat fewer students mention “Payment anxiety” (59%)


46

CitibankBank of America MasterCard

Fifth ThirdWells Fargo VISA

Bank of America VISAChase VISAWells Fargo

DiscoverCapital OneMasterCard

ChaseBank of America

Amercian ExpressVISA

1%1%1%1%

2%2%

3%3%

7%8%8%8%

17%21%

TOP OF MIND AWARENESS OF CREDIT CARD BRANDS

When asked what one brand of credit card that comes to mind first, 21% mention VISA (27% mention VISA or any iteration of VISA)

About one in six (17%) mention American Express

10% mention MasterCard or any iteration of MasterCard


47

Have%

Have inown

name%

Co-signed%

Any card 36 27 8VISA 24 18 8

MasterCard 10 8 4American

Express 3 2 1Discover 4 3 1

CREDIT CARD OWNERSHIP

36% have access to a credit card (own card or authorized use of someone else’s card)

27% have a VISA, MasterCard, American Express or Discover card in their own name

Students with a credit card in their own name are more than twice as likely to have a VISA than a MasterCard


48

FIRST CARD IN OWN NAME

The first credit card in students’ own name;

• 63% VISA

• 24% MasterCard

• 8% Discover

• 4% American Express

VISA63%

Master-Card24%

Dis-cover

8%American Express

5%


49

ISSUER OF FIRST CARD IN OWN NAME

40% of students’ first credit card in their own name was a;

Chase (14%)

Bank of America (also 14%)

Wells Fargo (12%) credit card

Don't knowTCF

American ExpressUS BankCitibank

Credit UnionFifth Third

DiscoverCapital OneWells Fargo

Bank of AmericaChase

7%

2%

3%

3%

4%

4%

4%

5%

8%

12%

14%

14%


50

WHEN APPLIED FOR FIRST CARD IN OWN NAME

62% of students applied for their first credit card before starting college

Average age 18

52% applied during the 3 month period June-August excluding the 31% who “Don’t know”

High school or

earlier33%

Summer before col-lege29%

Freshman18%

Sophomore7%

Junior6%

Senior2%

Don't know5%


51

PREPARED FOR RESPONSIBILITY OFOWNING & USING CREDIT CARD

More than 90% of students report being at least “Somewhat prepared” for the responsibility of owning and using a credit card

43% report being “Very prepared”

Very prepared

43%Somewhat prepared

48%

Not very prepared

12%

Not at all prepared4%


52

CREDIT EDUCATION RECEIVEDFROM ISSUER OF FIRST CARD

More than half of students (53%) report receiving at least “Enough” credit education from the issuer of their first card

About one in five (18%) report “More than enough” while about three in ten report “Very little” or “None”

More than

enough18%

Enough35%

Not as much as would

have liked18%

Very little15%

None14%


53

WHAT WAS IMPORTANT WHEN SELECTING WHERE TO OPEN CREDIT CARD ACCOUNT “Located near my

parents’ home” (33%) is the highest rated importance factor when selecting where to open their credit card account

One in four (25%) mention “Referred by a parent or other family member”

Don't know

Visited blogs to see what others had to say

Talked to a bank rep at school during an event

Offered credit education with card

Used the bank's website to do research

Offered credit card specifically for students

Referred by friends or fellow students

Good online banking capabilities

Reasonable pricing and fees

Reputation for good service

Located near the campus

Referred by a parent or other family member

Located near my parent's home

18%1%1%2%

7%7%8%9%

13%15%

22%25%

33%


54

LIKELIHOOD OF CANCELLING CREDIT CARD IN NEXT 12 MONTHS

One in seven report they are likely to cancel their credit card in the next 12 months

Considering the number of students with a VISA or MasterCard, a larger share of student with a MasterCard plan to cancel their card than those with a VISA

VISA MasterCardAmericanExpress Discover

TOP 2 BOX 15 13 11 6

Very likely 7 4 11 0

Somewhat likely 8 9 0 6

Unlikely 74 72 74 91

Don’t know 11 14 16 3


55

CREDIT CARDS INTERESTED IN OBTAINING IN OWN NAME IN THE NEXT YEAR About one in four

(26%) are interested in obtaining a credit card in their own name in the next 12 months

Among this 26%, 58% are interested in VISA, 27% MasterCard, 23% American Express and 12% Discover None of these

Discover

American Express

MasterCard

VISA

74%

3%

6%

7%

15%


56

NoneDon't know

OtherVideo downloads

Rebate for a car purchaseSporting goods

WellnessCar rentals

Points toward consumer electronicsMusic downloads

Restaurant discountsCell phone minutes

Event/concert ticketsHotel discounts/stays

Points toward gift certificates/cardsPoints toward airline tickets

TravelRebates on gas purchases

Entertainment (concerts, movies, events)Cash back

10%10%

3%1%2%3%3%4%4%5%5%

7%7%7%7%

10%10%

12%12%

53%

REWARDS INTERESTED IN RECEIVING FROM CREDIT CARD

By a wide margin “Cash back” (53%) is the highest rated reward students are interested in receiving from the issuer of their credit card


57

ISSUER OF CREDIT CARD(VISA/MASTERCARD IN STUDENTS’ OWN NAME)

Chase is the largest issuer of all VISA and MasterCards in students’ own name

Chase is the largest issuer of all VISA cards in students’ own name

Capital One and Bank of America (each 14%) are the largest issuers of all MasterCards in students’ own name

Share ofVISA or MasterCard

%

Share ofVISA

%

Share ofMasterCard

%

Chase 19 23 11Bank of America 17 17 14

Wells Fargo 15 15 12Capital One 7 4 14

Citibank 6 6 4Fifth Third 5 2 11

US Bank 4 5 1Credit Union 4 4 2

Regions 2 2 0


58

MasterCard VISA

69% 81%

31% 19%

Have account Don't have

HAVE CHECKING ACCOUNT AT SAME BANK AS ISSUED CREDIT CARD

81% of all students with a VISA credit card in their own name have a checking account with the same bank as issued their VISA card

69% of all students with a MasterCard credit card in their own name have checking account with the same bank as issued their MasterCard


59

CREDIT LIMITS

Students with an American Express credit card report a somewhat higher credit limit than others

Students with a MasterCard report the highest level of satisfaction with their credit card limit and also report the highest incidence of a credit limit increase in the past year

InitialCreditLimit

CurrentCreditLimit

SatisfiedWith

CreditLimit

%

LimitIncreased

In Past Year%

All cards $909 $1,428 89 37

VISA $890 $1,505 87 33

MasterCard $911 $1,388 91 38

AmericanExpress $1,323 $1,791 84 21

Discover $824 $1,614 89 N/A


60

VISA MasterCard Discover Amex

62%52%

17%35%

8%13%

26%

12%

5% 9%

34%

4% 5%9%

18%

4% 7%6%

At bank Website Mail offer800 number eMail offer

METHOD OF APPLYING FOR CREDIT CARD

By a wide margin, students are most likely to have applied at their bank when applying for their VISA or MasterCard

About a third of Discover cardholders and the largest share responded to an offer in the mail


61

PREFERRED METHOD FORAPPLYING FOR A CREDIT CARD

By a wide margin, nearly half (49%, including 25% who “Don’t know”) would prefer to apply in person at their bank when applying for a credit card

Don't know

Internet ad or offer

Company rep/event off campus

Company rep/event on campus

App (off campus)

App (on campus)

e-mail offer

Calling an 800 number

Mail offer at home or school

Company's web site

App in college newspaper/magazine

In person at a bank

25%1%1%1%2%2%3%4%4%

11%15%

49%


62

WHY APPLIED FOR LAST CREDIT CARD

One in five students report “Have account at bank”, the most commonly reported reason for applying for the last credit card they applied for

Don't knowCustomizable features

Premium/incentive/giftEntertainment rewards

Internet featuresOnly offer I got

My friendsAdvertising on TV

Frequent flyer rewardsLow annual percentage rate

No annual feeCard my parents usePre-approved status

First card I applied forGreater access to credit

Good credit limitMy parents

Cash-back rewardsHave an account at bank

7%2%2%

3%3%3%3%

4%5%5%

8%9%

13%13%

15%17%

19%20%

22%


63

CREDIT CARD USE

UseMonthly

%

TimesUsed

MonthlyAmountCharged

CarryBalance

%AverageBalance

ChargedLate

PaymentFee%

ChargedLate

PaymentFee >1

%Discover 94% 12 $224 14% $304 23% 12%American Express 95% 14 $164 32% $594 16% 33%VISA 91% 13 $250 29% $581 24% 42%MasterCard 89% 12 $241 37% $832 29% 58%

American Express cardholders report a somewhat higher incidence of using their card at least once monthly and also report using it somewhat more frequently

VISA cardholders report a somewhat higher average monthly amount charged

MasterCard cardholders are somewhat more likely to carry a balance and have been charged a late payment fee and have been charged a late payment fee more than once


64

WHY DECIDED TO ACQUIRECREDIT CARD IN OWN NAME

The top three reasons for acquiring a credit card in their own name are;

1. “Become more financially responsible” (47%)

2. “Establish a credit history” (44%)

3. “Convenience” (36%)

Don't know

Endorsement by school/org

Identification for check cashing

Keeping up with my friends

Rewards

To become more independent

Safer than cash

Manage spending

Protection in an emergency situation

So I can buy things when I don't have cash

Convenience

Establish a credit history

Become more financially responsible

8%

0%

4%

4%

10%

15%

18%

19%

19%

21%

36%

44%

47%


65

KNOWLEDGE WOULD LIKED TO HAVE HAD WHEN FIRST OPENED ACCOUNT “How a credit card

effects my credit rating” (15%), “Fees on the card such as over limit fees” (also 15%) and “The interest rate on the card” (14%) are the three most commonly mentioned items students would have liked to know when they first opened their account Nothing/Don't know

The basics of how a credit card works

Who to contact if I have a problem

How to pay my credit card bill

The importance of paying on time

What rewards I get on the card

How to manage my account online

The credit limit

The risk of identify theft

The grace period on the card

How to get more info about account

How to manage my spending

The interest rate on the card

Fees on the card such as over limit fees

How a credit card effects my credit rating

29%

7%

7%

8%

8%

8%

11%

11%

11%

12%

13%

13%

14%

15%

15%


66

AGREEMENT WITH STATEMENTS

Nearly seven in ten (69%) report “My parents think I can handle the responsibility of my own credit card”

More than six in ten (61%) report “My parents did not discourage me from acquiring my own credit card

Nearly six in ten (59%) report “my parents did not discourage me from acquiring my own credit card

My school is too pushy about promoting a credit card with the school logo on it

My parents had a major influence on my decision with WHICH BANK OR COMPANY to acquire my own credit card

My parents had a major influence on my decision to acquire my own credit card

I'm actually managing my credit card more responsibly than my parents believe I am

My parents did not discourage me from acquiring my own credit card

My parents think credit cards are a good way for me to establish my own credit history

My parents think I can handle the responsibility of my own credit card

30%

48%

51%

52%

61%

67%

69%


67

CREDIT CARD USED MOST OFTEN By a wide

margin (and consistent with the number os students with a VISA credit card in their own name) VISA is the credit card students use most often (61%)

VISA61%

Mas-terCard

24%

Ameri-can Ex-

press6%

Discover9%


68

ISSUER OF CARD USED MOST OFTEN

42% of students’ credit cards in own name are issued by;

Chase (16%)

Bank of America (13%)

Wells Fargo (also 13%)

US BankAmerican Express

Credit UnionFifth Third

DiscoverCitibank

Capital OneWells Fargo

Bank of AmericaChase

2%

4%

4%

5%

6%

6%

6%

13%

13%

16%


69

WHY CARD USED MOST OFTEN

Students report a variety of reasons why they use one particular card most often

“First card I obtained” is the reason mentioned most often

IT'S THE ONLY CARD I HAVEDon't know

Special incentives to sign upCard my friends use

To support my school or other organizationI like their customer service

It's the brand I preferOffers rewards points

Card designIt still has available credit

First card I see in my walletIt's the brand I trust

Widely acceptedLow interest rateMost convenient

Card my parents useHigher credit lineOffers cash back

It's from my bankFirst card I obtained

52%6%

0%1%1%2%2%2%3%3%4%4%4%5%5%6%6%6%7%

10%


70

INTEREST RATES More than half of all

students with a credit card in their own name “Don’t know” when their interest rate was last increased

17% report an increase within the last year or more recently

One in five (20%) report their interest rate has “Never” been increased

Don't know

Never increased

No increase

Within last year

Within last six months

Within last three months

Last month

55%

20%

8%

6%

4%

4%

3%


71

CREDIT CARD SOLICITATIONS

In a typical month;

53% of students receive a credit card solicitation in the mail (down from 59% last year)

39% via eMail (unchanged from last year)

16% from a telemaketer (17% last year)

Type

ReceiveAny%

Average(User

Mean)

U.S. Mail 53% 2.9 eMail 39% 4.9

Telemarketer 16% 3.2

http://www.goneindia.com/mastercard.jpg

http://www.goneindia.com/visa-large.gif


72

CREDIT CARDS APPLIED FOR,APPROVED & ACTIVATED

12% of students have applied for 1 or more credit cards in their own name in the past year

7% of students were approved for one or more credit cards in their own name in the past year

7% of students activated one or more credit cards in their own name in the past year

Appliedfor Approved Activated

None 88% 41% 6%

1 8% 47% 74%

2-3 4% 7% 12%

More than 3 1% 6% 9%

Total mean .2 1.0 1.6

User mean 1.7 1.6 1.7

http://www.goneindia.com/mastercard.jpg

http://www.goneindia.com/visa-large.gif


73

FIVE MOST IMPORTANT CREDIT CARD CHARACTERISTICS/FEATURES

“Accepts payment online” (41%) and “24 hour toll-free customer service” (also 41%) are the highest rated credit card characteristics and features

35% mention “Can be used at ATM” and an equal number mention “Card for college students” No credit history needed for approval

Many services included with the card

Frequent flyer mileage credit for each dollar you spend

Cash back rewards for purchases

Card I can get in my name

Allows you to view account online

Card for college students

Can be used at ATM

24 hour toll-free customer service

Accepts payment online

14%

15%

17%

24%

26%

34%

35%

35%

41%

41%


74

THREE MOST IMPORTANT CREDIT CARD DESIGN ATTRIBUTES

The three highest rated credit card design attributes are;

1. “Cool design” (62%)

2. “Photo on card for ID purposes” (56%)

3. “Associated with the brand or organization I identify with” (53%)

Mini card that can fit on a keychain

Contactless

Photo on card that I chose

Customized with choice of graphics, photos, etc.

Associated with brand/org that I identify with

Photo on card for ID purposes

Cool design

24%

27%

30%

48%

53%

56%

62%


75

AGREEMENT WITH STATEMENTS ABOUT CREDIT CARDS

More than six in ten (63%) believe “It is or would be my responsibility to keep track of how much I spend with credit cards”

26% believe “I can build my credit history buy using my parent’s card”

I can build my credit history by using my parent's credit card

My college provides me with resources to use credit responsibly

I can build my credit history by using my debit card

Credit cards allow me or would allow me to manage my spending more effectively than cash or checks

Credit cards give me more consumer security in making purchases than cash or checks

I use or would use my credit card for recurring payments such as payments to cell phone providers, utilities, cable, etc.

I use or would use my credit card for emergencies only

My parents taught me how to use credit responsibly

Credit card issuers are too aggressive in marketing their cards to students

Credit card companies should do more to teach students how to use credit responsibly

I am responsible enough to have a credit card in my own name

Credit cards encourage students to spend too much

It is or would be my responsibility to keep track of how much I spend with credit cards

26%30%31%34%35%35%

43%48%49%49%

57%60%63%


76

LIKELIHOOD OF USING SPENDING CONTROLS/ALERTS

Less than three in ten report being likely to use 1 or more of 8 types of spending alerts

70% prefer to receive the alert “within seconds of purchase:”

Nearly six in ten (57%) prefer to receive the alert in the form of a text message

For withdrawing cash at ATM

Total amount spent per time period

Maximum single purchase amount

Geographic location

Online vs. retail location

Type of merchant categories

Day or Time

Specific merchant

18%

21%

22%

23%

24%

26%

26%

27%


77

RECEIVING MONEY FROM HOME

64% report receiving money from home (the incidence of receiving money from home decreases with year in school)

Among this 64%, 52% receive cash and 44% report their parents transfer money into a checking account

Among this 64%, 75% use this money for living expenses, 63% general spending money and 45% for books and supplies

I don't receive money from home

My parents pay my credit card bill

My parents send me a check

I have a debit card linked to my parent's checking account

My parents transfer money into a checking account

My parents give me cash

36%

9%

9%

13%

28%

33%


78

SPENDING & BUDGETS

More students “Keep spending in my head” (33%) than “Record spending” (29%)

About one in ten “Do not keep track of spending” and nearly one in five (18%) “Receive alerts from bank/credit card

Keep spending in my head

33%

Record spending29%

Alerts from my bank/credit

card18%

Do not keep track9%

Do not have budget11%


79

None of these

MasterCard

Discover

American Express

Visa

Savings account

Checking account

85%

1%

1%

1%

2%

7%

9%

ACCOUNTS CLOSEDIN THE LAST SIX MONTHS

15% have closed a bank or credit card account in the past 6 months

Among this 15%, 60% closed a checking account and 47% closed a check account

Far fewer students closed a credit card account


80

BANK WHERE CLOSED . . .

Checking Savings VISA MasterCard

Bank % Bank % Bank % Bank %Bank of America 29 Bank of America 24 Chase 26 BB&T 17

Chase 25 Chase 18 Wells Fargo 17 Chase 17

Fifth Third 7 Credit Union 8 Bank of America 4 Wells Fargo 17

Barclay's 4 Fifth Third 6 Capital One 4 Capital One 8

Fifth Third 4 Citizen's 5 National City 4 Credit Union 8

Students who closed a checking or savings account were most likely to have closed a Bank of America checking or savings account

Students who closed a VISA account were most likely to have closed a Chase VISA account

Students who closed a MasterCard account were most likely to have closed a Wells Fargo, Chase or BB&T MasterCard account


81

CAMPUS CARD OWNERSHIP Nearly half

(47%) have a Campus Card

Students at Private schools (57%) are more likely than students at Public schools (41%) to have a school-issued campus card

Have Campus

Card47%

Do not have

campus card53%


82

DESCRIPTION OF CAMPUS CARD

Among the 47% with a Campus Card, 57% have a campus card that acts as a Student ID, provides building access and serves as a payment card

26% of those with a Campus Card report their card has a bank logo

ID only, payment card, building access and has VISA, MC or Dis-

cover acceptance

ID, payment card

ID, building access, payment card

15%

28%

57%


83

IMPORTANCE OF SCHOOL PROVIDING CAMPUS CARD

About two in three (65%) believe it is at least “Somewhat important” for their school to provide them with a school issued Campus Card

Importance ranges from a high of 74% among students living on campus to a low of 47% among students living at home and commuting to school

Very unimportant

Somewhat unimportant

Neither

Somewhat important

Very important

11%

4%

13%

29%

36%


84

LOCATIONS WHERE SCHOOL ISSUEDCAMPUS CARD IS USED TO MAKE PURCHASES

Students are most likely to use their school issued Campus Card for;

“On campus dining” (90%)

“On campus bookstore” (76%)

“On campus printers/copiers” (65%)

“On campus vending” (57%) Online

Off campus stores

Off campus restaurants

On campus laundry

On campus vending

On campus printers/copiers

On campus bookstore

On campus dining

15%26%31%

51%57%

65%76%

90%


85

FREQUENCY OF USING CAMPUS CARD TO MAKE PURCHASES

Among those whose Campus Card serves as a payment card, 72% use it to make purchases

Among this 72%, 63% use it to make purchases several times a week or more often

Daily29%

Several times a week16%

About once a week7%

A few times a month

12%

Less than once a month

8%

Never28%


86

AMOUNT SPENT WITH SCHOOL ISSUED CAMPUS CARD IN A TYPICAL WEEK

Among the 72% who use their school issued campus card to make purchases, these students spend an average of $30 weekly

As would be expected, students living on campus report spending nearly three times what students living off campus report ($43 compared to $15)

Nothing31%

Less than $2533%

$25 to $5019%

$51 to $754%

$76 to $1008%

More than $1005%


87

None31%

1 to 1052%

11 to 157%

16 to 205%

21 to 303%

More than 303%

NUMBER OF PURCHASES MADE WITH SCHOOL ISSUED CAMPUS CARD IN A TYPICAL WEEK

Among the 72% who use their school issued campus card to make purchases, students make an average of 7 transactions weekly

Students living on campus report making more than twice as many transactions compared to students living off campus (10 compared to 4)


88

PERCENT OF SPENDING WITH SCHOOL ISSUED CAMPUS CARD ON CAMPUS/OFF CAMPUS

87% spend on campus with their Campus Card (little difference based on residency)

51% spend some portion with their card off campus

Among the 51% spending off campus, students living at home spend more than students living on campus

Total%

OnCampus

%

OffCampus

%

AtHome

%

On campus . . . None 5 2 8 6 User Mean 87 88 86 88Off campus . . .

None 49 45 50 59 User Mean 46 37 54 56


89

IMPORTANCE OF BENEFITS OFSCHOOL ISSUED CAMPUS CARD

The three, highest rated benefits of a school issued Campus Card are;

1. “Convenience” (53%)

2. “Don’t have to carry cash” (49%)

3. “Handles most on campus needs” (47%) Handles most off campus needs

Can access different pools of funds

Parents pay for it

Helps control spending

Provides record of spending

Only need to carry one card

Already pre-paid

Handles most on campus needs

Don't have to carry cash

Convenience

26%30%31%

37%38%38%

43%47%49%

53%


90

FINANCIAL SERVICES PRODUCTS OWNED IN OWN NAME

45% own one or more of seventeen insurance or investment products in their own name

Among this 45%, 42% own automobile insurance and 40% own cell phone or personal electronics insurance

5% of all students own student loans insurance and 2% own tuition insurance NONE OF THESE

ID theft insuranceMoney Market Funds

Real EstateTravel insurance

Home Owner's InsuranceMutual Funds

Tuition insuranceRenter's Insurance

Certificates of DepositLife Insurance

BondsDental insurance

Savings BondsStocks

Student loan insuranceCell phone/personal electronics insurance

Auto Insurance

55%1%1%1%1%2%2%2%3%4%4%5%5%5%5%5%

18%19%


91

FINANCIAL SERVICES PRODUCTS PLAN TO PURCHASE IN NEXT 12 MONTHS

23% of students plan to purchase one or more of seventeen insurance or investment products in their own name in the next 12 months

Among this 23%, 39% plan to purchase auto insurance and 26% plan to purchase cell phone or personal electronics insurance

NONE OF THESE

ID theft insurance

Home Owner's Insurance

Life Insurance

Student loan insurance

Mutual Funds

Certificates of Deposit

Dental insurance

Cell phone/personal electronics insurance

77%0%1%1%1%1%1%1%1%2%2%2%2%2%2%4%6%9%


92

SOURCES OF HEALTH INSURANCE

49% report their school requires students to have health insurance

Among the 90% with health insurance, 60% report their health insurance coverage is part of their parents’ policy

I DON'T HAVE HEALTH INSURANCE

Other

Through my spouse

Other state subsidized policy

Through my job

Through school

Medicare/Medicaid

Don't know

Parents' policy

10%

3%

1%

2%

5%

8%

10%

12%

54%


93

CONCERN FOR EXPERIENCING . . .

50% report a high risk and concern for personally experiencing hospital care for an accident related injury

48% report a high risk and concern for personally experiencing an auto accident resulting in vehicle damage or injury

Hospitalization for acute medical condition

Identity theft

Loss of personal property

Auto accident

Hospital care for accident related injury

39%

44%

47%

48%

50%


94

WHERE MOST LIKELY TOPURCHASE INSURANCE PRODUCTS Nearly half of all

students (47%) “Don’t know” where they are most likely to purchase insurance products

Among the 53% with a preference, 57% report being most likely to purchase insurance products from a “Local insurance agent” and 17% from an internet insurance web site

Government assistance program

3%

Multi-product insurance web site

4%

Other7%

Internet in-surance web

site9%

Local in-surance

agent30%

Don't know47%


95

None of these

I have had an auto accident injury requiring hospitalization or medical attention

I have/have had a friend who has been a victim of identity theft

I have/have had a friend withdraw for emergency/family reasons from college

I have/have had a friend been the victim of a loss of personal property

I have/have had a friend been involved in an auto accident

I have/have had a friend required medical attention for a serious injury or illness

I have/have had a friend hospitalized

38%

6%

9%

12%

24%

27%

28%

38%

“IN THE PAST TWO YEARS”. . .

Nearly four in ten (48%) report they have or have had a friend hospitalized in the past two years

About one in eight (12%) report they have or have has a friend withdraw from college for emergency or family reasons


96

Affinity Group

High school seminar

Bank

Information received in the mail

High school guidance counselor

Friends

Student loan company

Internet

Relatives other than parents

School's financial aid office

Parents

11%

24%

27%

28%

34%

38%

38%

45%

46%

58%

73%

INFLUENTIAL SOURCESABOUT PAYING FOR COLLEGE

More than seven in ten (73% and the largest group of students) believe “Parents” are the most influential source about paying for college

Nearly six in ten (58%) mention their school’s financial aid office

Fewer than four in ten (38%) mention a student loan company and even fewer (27%) mention a bank


97

I found the process of identifying ways to pay for college to be complicated and confusing

My school's financial aid office was helpful in identifying ways to pay for college

My parents did most of the work when it came to figuring out how to pay for college

I'm confident in my ability to repay my student loans according to the terms and conditions of my loans

43%

44%

45%

54%

AGREEMENT WITH STATEMENTSABOUT PAYING FOR COLLEGE

Only somewhat more than half (54%) are confident about paying back their student loans

More than four in ten (43%) believe “the process of identifying ways to pay for college to be complicated and confusing”


98

Nothing32%

$5,000 or less10%

$5,001 to $10,00010%$10,001 to $15,000

5%

$15,001 to $20,000

11%

More than $20,000

32%

UNDERGRAD STUDENT LOAN DEBT 68% expect to have

undergraduate student loan debt

Among this 68%, students attending Private schools expect to have an average of $34,381 in student loan debt or 26% more than students attending Public schools ($27,250)

Students believe it will take an average of 7.5 years to payoff their loan


99

SOURCES OF STUDENT LOAN DEBT

Among the 68% who expect to graduate with undergrad student loan debt, 60% of that debt is a Government student loan

Virtually equal shares of student loan debt are represented by Private loans from a bank or credit union and Loans direct from my school (22% and 21% respectively)

Friends2%

My credit card3% Other

5%

Relatives15%

Loans direct from my

school21%

Private loan from a bank or credit union

22%

Government student loan

60%


100

FALL 2012 PRODUCTION TIMETABLELIFESTYLE & MEDIA, COMPUTING & THE INTERNET

20th DraftQuestionnaireDistributed

20th ToplineResultsDistributed

17th Final Report,PresentationsBegin

9th In Field

AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER

10th Comments,Proprietary Questions Due

17th QuestionnaireFinalized

®. Conducted each Spring and Fall semester Conducted each Spring and Fall semester On campus,...

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