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1
FINANCIAL SERVICESSPRING 2011
© 2011 STUDENT MONITOR LLC550 North Maple Ave., Ridgewood, NJ 07450
© 2011 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 week of March 11, 2011
1,200 Four Year full-time undergrads
Representative sample
100 campuses stratified by:
Enrollment size
Administrative Control
Geographic location (U.S. Census Region/Census Division)
Margin of error +/- 2.4%
© 2011 STUDENT MONITOR LLC – All Rights Reserved, Unauthorized Use Prohibited
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%
© 2011 STUDENT MONITOR LLC – All Rights Reserved, Unauthorized Use Prohibited
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-DEMOGRAPHICS
Compared to last year, declines are seen for monthly discretionary spending, personal earnings and family HH income
Monthly discretionary spending: $195 (-15%) Annual personal earnings: $4,183 (-16%) 65% get money from home averaging $265
monthly 7% are employed full-time and 42% are employed
part-time and 5% have an internship during the school year
Average age: 20.6 Family HH income: $94,118 (-11%)
© 2011 STUDENT MONITOR LLC – All Rights Reserved, Unauthorized Use Prohibited
5
-TOP 10 ACADEMIC MAJORS
Business, followed by Biology, Education and Engineering continue to be the most common majors
Total%
Male%
Female%
Business 11 14 8Biology 7 6 8Education 7 4 10Engineering 7 10 4Health Professions 6 4 8Psychology 5 4 6Communications 4 3 5Accounting 4 5 3Pre-Med 3 3 3Liberal Arts 3 3 3
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STUDENT BANKING - 65% have a checking account in their own name, (average balance $647, down 16%
from $774 last year)
38% (down from 48% last year) were offered a credit card when they opened their checking account and 33% accepted the offer and received the card
48% have a savings account in their own name, average balance $1,127
20% were offered a credit card when they opened their savings account and 30% (32% last year) accepted the offer and received the card
44% have an ATM card in their own name (43% last year) and 62% have a debit or check card in their own name
68% of those with a Campus Card have a card that acts as an ID, provides building access and also serves as a stored value card
55% use their computer for online banking or financial services transactions
-SUMMARY FINDINGS:
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PAYMENT METHODS - 32% of monthly spending is cash-based (33% last year), 44% with an ATM/debit or check
card , 9% with a credit card and 4% with a school issued Campus Card
74% (up from 69% last year) use their ATM card to pay for purchases and 74% 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 14 times monthly
62% have a debit or check card in their own name. Nearly half are Bank of America (20%), Chase (14%) or Wells Fargo (9%) issued check cards
Nearly all with a debit/check card (95%) use their card to pay for purchases and 76% of these students 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
About one in four without a debit/check card (27%) are at least somewhat interested in obtaining one
-SUMMARY FINDINGS:
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CREDIT CARDS - 38% (36% last year and down from 53% eight years ago) have a credit card in their own
name (VISA, MasterCard, Discover or American Express).
25% of all students have a VISA card in their own name, 11% MasterCard, 2% American Express and 2% Discover
The average student cardholder has 1.3 cards (1.4 last year), 77% have one card, 18% have two cards and 5% have three or more cards. About one in twenty (6%, down from 14%) report that their parents “Don’t know” they have a credit card.
Chase (17%), Bank of America (16%), and Capital One (6%) are the largest issuers of all VISA and MasterCard credit cards in students’ own name. Bank of America (19%) is the largest VISA issuer and Chase (14%) is the largest MasterCard issuer
85% of are satisfied with their credit limit and 27% (38% last year and 42% last year two years ago) received a credit limit increase in the past year (average credit limit is $1,688 or twice that of students’ initial credit limit was when they first acquired their card $849)
-SUMMARY FINDINGS:
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CREDIT CARDS (continued) -
86% use their credit card monthly or more often with 50% using their card weekly or more often (a typical month’s charge is $174, down 9% from last year’s $192)
68% (up somewhat from last year’s 63%) pay their bill in full each month (among the 34% who carry a balance forward, the average balance is $695, up 35% from $513 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
56% acquired their first card before starting college
79% believe they or their parents and family have the primary responsibility to educate them about managing their finances
Identical numbers of students (47%) believe they received enough credit education from the issuer of their credit card as those who did not (8% “Don’t know”)
More than four in ten students (44%) are interested in obtaining a credit card in the next year
-SUMMARY FINDINGS:
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STUDENT LOANS -“Parents” (72%) and “School’s financial aid office” 53% are the most influential sources of
information about paying for college (31% identify their bank)
69% of students expect to have undergrad student loan debt averaging $26,450 and nearly $31,095 among students attending Private schools. Anticipated pay off is 7 years
56% of student loan debt is from government sources, 20% (18% last year) private, bank loans and 20% (up from 14% last year) are loans direct from their school. Nearly half (47%) plan to consolidate their loans
61% (down somewhat from 65% last year) 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
17% “Don’t have” health insurance or “Don’t know” if they have health insurance (66% have health insurance through their parents)
-SUMMARY FINDINGS:
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-INTEREST IN INCREASING KNOWLEDGE/LITERACY (“VERY/SOMEWHAT
INTERESTED)”
Students report comparatively equal levels of interest in creasing their knowledge and literacy of a variety of financial services products
Student loans
Credit cards
Checking
Savings
Credit
Investments
45%
46%
47%
49%
53%
54%
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-IMPORTANCE OF PAYMENT CARD FEATURES (“VERY/SOMEWHAT
IMPORTANT)”
“Builds a credit history” (68%) is nearly three times as important as “Offers a cool card design/unique card shape” (25%) and nearly twice as important as “Provides merchant savings” (35%) Offers a cool card design/unique card shape
Provides merchant savings
Provides credit payment card education
Provides a reward or student only pricing program
Access to merchants that require a credit card
Provides a "limit-control"
Offers a rewards program
Provides budget controls and alerts
Builds a credit history
25%
35%
39%
46%
48%
48%
48%
50%
68%
© 2011 STUDENT MONITOR LLC – All Rights Reserved, Unauthorized Use Prohibited
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-MONTHLY SPENDING
%Shoppers
MonthlyPurchases
MonthlySpending
$
MostCommonPaymentMethod
Bookstore (off campus) 30 4.2 33.63 ATM/Check/Debit
Bookstore (on campus) 46 3.8 33.32 ATM/Check/Debit
Convenience store (off campus) 68 7.1 28.11 ATM/Check/Debit
Convenience store (on campus) 52 6.9 23.64 ATM/Check/Debit
Department store 58 4.3 45.38 ATM/Check/Debit
Fast food restaurant 81 7.5 30.22 ATM/Check/Debit
Gas station 72 5.8 60.98 ATM/Check/Debit
Movie theater 55 2.4 17.39 ATM/Check/Debit
Online purchases 48 4.2 39.34 ATM/Check/Debit
Other retail or specialty store (off campus) 41 3.7 33.34 ATM/Check/Debit
Other stores on campus 32 4.1 22.39 ATM/Check/Debit
Restaurant (non fast food) 69 4.0 37.43 ATM/Check/Debit
Supermarket 74 6.0 59.10 ATM/Check/Debit
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-SHARE OF MONTHLYSPENDING BY METHOD
Nearly half of monthly spending (44%) is with an ATM/Debit or Check card followed by Cash (42%)
About 14% of monthly spending is with a credit card (virtually identical to last year)
ATM/Debit
/Check card44%
Cash42%
Par-ent's credit card5%
Credit card9%
Check4%
School issued Campus Card7%
Pre-paid2%
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-INFLUENCE OF PARENTS WHEN . . .
Students report their parents are more influential about “Opening a checking account” or “Selecting a mobile phone provider” than “Obtaining a student loan”
Obtaining renter's insurance
Obtaining student loan
Obtaining auto insurance
Obtaining health insurance
Selecting mobile phone provider
Opening checking account
22%
44%
46%
49%
52%
62%
© 2011 STUDENT MONITOR LLC – All Rights Reserved, Unauthorized Use Prohibited
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-STATEMENTS ABOUT STUDENT FINANCES(TOP 2 BOX – “STRONGLY” OR “SOMEWHAT AGREE)
“Financial literacy is more important to me in college” 66%
“I’m concerned about managing my money after graduation” 63%
“I’m concerned about managing my money in school” 60%
“I would be interested in understanding how insurance can help control risks such as medical costs or repaying student loans” 46%
“My school offers me enough relevant financial education” 43%
“I would be interested in advice provided by my bank to help me cope with the challenges of this economy” 41%
“I would be interested in learning about all of the products my bank has to offer at one time” 40%
“The student loan application process is too complicated” 38%
“Compared to last year, I am more likely to need a student loan to stay in school” 38%
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Very im-portant
64%
Somewhat important
19%
Neither impor-tant nor
unimportant4%
Somewhat unimportant
2%
Very unimpor-tant2%
Don't know9%
-CREDIT SCORES One in five (20%,
up somewhat from 16% last year) know what their credit score is (increases with year in school from 14% among Freshmen to 24% among Seniors)
83% believe it is important to have a good credit score or credit history
© 2011 STUDENT MONITOR LLC – All Rights Reserved, Unauthorized Use Prohibited
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-WHO HAS PRIMARY RESPONSIBILITY TO PROVIDE EDUCATION ABOUT MANAGING YOUR FINANCES?
Nearly four in five (79%) believe they or their parents have the primary responsibility to provide them with education about managing their finances
Parents or family43%
Myself36%
My bank4%
My school3%
My credit card
company1%
My high school
3%
My friends
1%
Don't know8%
Other2%
© 2011 STUDENT MONITOR LLC – All Rights Reserved, Unauthorized Use Prohibited
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-REASONS FOR VISITING BANK’S WEBSITE
The top reasons for visiting their bank’s website (with a computer, not a cell phone) are:
1. “Check account balance” (52%)
2. “Check transaction activity” (33%)
3. “Transfer funds from one account to another” (20%)
4. “Pay a bill online” (16%)
Have not visited bank's website
Learn about bank offers
Learn about managing finances
Apply for an auto loan
Create a budget
Access educational resources
Apply for a credit card
Contact bank’s customer service
Apply for a student loan
Find branch location
Find ATM’s
Pay a bill online
Transfer funds from one account to another
Check transaction activity
Check account balance
29%2%3%3%4%4%
6%7%
10%12%
14%16%
20%33%
52%
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-IMPORTANCE OF HAVING ALL ACCOUNTS WITH ONE BANK
Nearly six in ten (59%) believe it is at least “Somewhat important” to have all accounts with one bank (a fourth as many believe it is “Unimportant”
Very im-por-tant25%
Somewhat im-por-tant34%
Neither26%
Some-what unim-
portant8%
Very unimportant7%
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-CHECKING ACCOUNT OWNERSHIP
82% of students have a checking account
65% have a checking account in their own name
The incidence of having a checking account in own name increases with year in school (54% among Freshmen to 75% among Seniors)
Have checking account in own
name65%
My parents and I have a joint checking ac-
count12%
My parents have a checking account for me they manage
4%
I do not have a checking ac-
count18%
© 2011 STUDENT MONITOR LLC – All Rights Reserved, Unauthorized Use Prohibited
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-STATEMENTS ABOUTCHECKING ACCOUNTS
Top 2 Box“Strongly” or
“Somewhat Agree”%
“My parents think I can handle the responsibilityof my own checking account” 74“My parents did not discourage me from openingmy own checking account 71“My parents had a major influence on my decisionto open my own checking account 63“My parents had a major influence on where to open my checking account 56“I’m actually managing my checking account moreresponsibly than my parents believe I am” 48
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-WHERE STUDENTSHAVE THEIR CHECKING ACCOUNT
Nearly half of all students with a checking account (44%) have their checking account with Bank of America, Chase or Wells Fargo
Exactly one in five (20%) with a checking account have a Bank of America checking account BB&T
HSBC
Regions
Citibank
Wachovia
TD Bank
Sun Trust
PNC
Wells Fargo
Bank of America
1%1%1%1%
2%2%2%2%2%2%2%2%
3%4%
5%5%
9%15%
20%
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-MONTH OPENED CHECKING ACCOUNT
Exclusive of the 41% of students who “Don’t know” what month they opened their checking account, 41% of those with a checking account opened it in the three month “Back to school” period July through September
Don't know
December
November
October
September
August
July
June
May
April
March
February
January
41%1%2%2%
6%9%9%
8%6%
4%5%
4%4%
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-HOW STUDENTS OPENEDTHEIR CHECKING ACCOUNT
Six in ten (60%) opened their checking account by “Visited branch with parent” while about one in five (21%) “Visited branch on my own”
Don't know
Other
Opened account at school during bank event
Opened account using bank's website
Visited branch with a friend who banks there
Visited branch on my own
Visited branch with parent
7%
4%
2%
2%
4%
21%
60%
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-CRITERIA USED WHEN SELECTINGWHERE TO OPEN CHECKING ACCOUNT
“Location” and “Family referral” are the most frequently mentioned reasons students used when selecting where to open their checking account
Visited blogs to see what others had to say
Talked to a bank rep at school
Used the bank’s website to do research
Referred by friends or fellow students
Offered checking specifically for students
Good online banking capabilities
Reasonable pricing and fees
Reputation for good service
Located near my campus
Referred by a parent/family member
Located near my parent’s home
1%
2%
3%
6%
11%
12%
15%
21%
28%
33%
41%
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-OVERDRAFT PROTECTION
Nearly six in ten (57%, up from 49% last year) were offered overdraft protection when they opened their checking account
57% (up from 53% last year) have overdraft protection (transfer from a savings account is the most common protection)
“Avoiding bounced check fees” (46%) and “Avoid potential negative reports to credit agencies (32%) are the most commonly reported benefits of overdraft protection
47% (down from 56% last year) have been charged an ISF fee (user mean of 2.1 times)
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-CHECKING ACCOUNTAbout four in ten (38%, down from 48% last year)
were offered a credit card when they opened their checking account (33%, down somewhat from 37% last year, accepted the offer)
Students write an average .7 paper checks per month (down from 1.3 last year). 63%, up from 47% last year, write “None”)
Students maintain an average monthly balance of $647, down 14% from $749 last year
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-AVAILABILITY/USE OFTEXT & EMAIL ALERTS
56% of those who know their bank offers alerts, use those alerts
More than a third (36%) “Don’t know” if their bank offers alerts
Not offered7%
Offered and used32%
Offered but not used25%
Don't know if bank of-
fers alerts36%
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-INTEREST IN RECEIVINGTEXT & EMAIL ALERTS
Virtually half (49%) are at least “Somewhat interested” in receiving text or eMail alerts from their bank (somewhat more so than those not interested at 39%)
Very in-terested
22%
Somewhat interested
27%Neither13%
Some-what un-
interested12%
Not at all interested
27%
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-TYPES OF EMAIL ALERTS USED
The most commonly used alerts are
“Balance alerts”
“Security alerts”
“General banking alerts”
“Bill payment alerts”
Among those offered alerts, 50% don’t use any
Not offered
Offered, do not use
Spending Alert (above a certain dollar amount)
Budget Alert (when approaching/exceeded budget)
Bill Payment Alert (upcoming/due/incomplete)
General Banking Alert (statement available, address changed, etc.)
Security alerts
Balance Alerts (current balance; low balance; approaching limit)
12%
44%
13%
8%
10%
14%
25%
31%
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-LIKELIHOOD OF USING ALERTS
Students would be most likely to use alerts for “Withdrawing cash from ATM” (51%) and least likely for a “Specific merchant” (30%)
Specific merchant
Specific merchant categories
Online vs. retail location
Day or time
Geographic location
Maximum single purchase
Total amount
Withdrawing cash from ATM
7%
8%
10%
11%
12%
14%
16%
19%
23%
24%
27%
25%
28%
31%
31%
32%
Definitely would use Probably would use
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-WHEN PREFER TO RECEIVE ALERTS
About seven in ten (71%) prefer to receive alerts “Within seconds of purchase” while one in four (24%) prefer “Day after purchase”
Within sec-onds of
purchase71%
Day after purchase
24%
3 to 5 days after purchase
5%
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-PREFERRED WAY TO RECEIVE ALERTS
About six in ten (61%) prefer an text message from their bank while about three in ten (29%) prefer an eMail message from their bank
Nearly six in ten (57%) would prefer to “turn on/off as I wish”
eMail from bank
28%
Text message
from bank61%
Phone call from bank
9%
Money management tool1%
Other1%
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-AMOUNT THAT TRIGGERS SPENDING ALERTS
More than half (53%) would set a spending alert
Males would prefer a single transaction to trigger an alert at a somewhat higher amount than females ($292 compared to $279 among females)
30% want the transaction to be declined and an alert sent if transaction exceeds a pre-determined amount
$231 is the average, minimum amount that would trigger a “declined” for the purchase
Total Male Female
Would set alert 53% 57% 50%
$50 or less 24% 26% 22%
$51 to $100 26% 22% 30%
$101 to $200 15% 15% 15%
More than $200 36% 38% 34%
User Mean $285 $292 $279
Would not set 46% 42% 50%
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-MONEY FROM HOMEAbout two in three (65%) receive money from home each month and among this group receiving money;
80% for living expenses
72% for general spending money
47% 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
35%
8%
10%
11%
27%
31%
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-SPENDING & BUDGETS Nearly four in ten
(36%) and the largest group of students report “I keep my spending in my head”
The next largest group (28%) report “I keep track of my spending by recording it”
I keep my spending in
my head36%
I keep track of my spending by recording it
28%
I receive bal-ance or spend-ing alerts from
my bank and/or issuer of my credit card
13%
I do not keep track of my
spending9%
I do not have a budget
14%
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-SAVINGS ACCOUNT OWNERSHIP
66% of students have a savings account
48% have a savings account in their own name
The incidence of having a savings account in own name increases with year in school (39% among Freshmen to 56% among Seniors)
Have savings account in own
name48%
Parents and I have a joint savings account
11%
Parents have a savings account
for me they manage
8%
I do not have a savings ac-
count34%
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-SAVINGS ACCOUNT
About one in five (20%, virtually unchanged from last year) were offered a credit card when they opened their savings account
About a third (30%) of those who were offered a credit card when they opened their savings account accepted the credit card offer and were approved (3% accepted the offer but were declined)
Students maintain an average monthly savings account balance of $1,127, down from $1,728 last year
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-ATM CARDS 44% of students have an ATM card in their own name
(compared to 43% last year) 63% use their ATM card for banking transactions weekly or
more often “Getting cash” (86%), “Check account balance” (49%) and
“Make deposits to an account” (40%) are the most common activities
Nearly eight in ten (79%, up from 69% last year) use their ATM card to pay for purchases and 74% 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 14 times monthly to pay for purchases
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62% of students have an Debit or Check card in their own name
More than four in ten (43%) have a Bank of America, Chase or Wells Fargo issued Debit/Check card
More than eight in ten (82%) report their card has a VISA or MasterCard logo on it
Nearly all (95%) use their card to pay for purchases and 76% (78% last year) use their card to pay for purchases weekly or more often an average of 17 times monthly
About one in four without a Debit/Check card (27%) are at least “Somewhat interested” in obtaining one
-DEBIT/CHECK CARD
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-DEBIT/CHECK CARD Among the
70% of students with a Debit or Check card in their own name, 43% identify Bank of America, Chase or Wells Fargo as the issuer of their card
USAA
Sovereign
Regions
Key Bank
Wachovia
TD Bank
PNC
US Bank
Wells Fargo
Bank of America
1%1%1%1%1%
2%2%2%2%2%2%2%
3%3%
4%6%
9%14%
20%
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-BANKING ONLINEMore than half (53%) are at least “Somewhat
interested” in banking online (increases with year in school)
55% use their computer for online banking or financial services transactions (also increases with year in school ranging from 45% among Freshmen to 59% among Seniors)
“Checking balances” (88%), “Check transactions” (59%), Transfer funds” (41%) and “Pay bills” (33%) are the most commonly reported online transactions
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-REASONS WHY STUDENTSAPPLY FOR A CREDIT CARD
By a narrow margin, “Build a credit history” is the most commonly reported reason why students apply for a credit card (increases with year in school ranging from 45% among Freshmen to 65% among Seniors)
Keep up with friends
ID for check cashing
Rewards
Emergencies
Manage spending
Safer than cash
Become more independent
Can buy things when don't have cash
Convenience
Become more financially responsible
Build credit history
2%
4%
14%
16%
16%
19%
21%
24%
37%
42%
46%
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-IMPORTANCE OF REASONS FOR HAVING A CREDIT CARD (TOP 2 BOX –
“VERY/SOMEWHAT IMPORTANT”)
“Emergencies” and “Start building a credit history” are the most commonly reported reasons (based on importance) why students believe it is important to have a credit card
Rewards on purchases
Benefits
Convenience
Control
Security
Use where other payment options are not accepted
Start building credit history
Emergencies
48%
52%
53%
56%
57%
58%
63%
66%
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-IF STUDENTS RECEIVED THEIRFIRST CREDIT CARD TODAY . . .
The largest share (20%) would shift 11% to 25% of their spending away from other payment methods to their credit card (including the 41% who would shift 0%)
A third (33%) would use the card weekly or more often (23% would “never use it)
More than four in ten (45% and the largest share) would spent $1 to $100 monthly with the card or an average of $134 among the 72% who would spend something
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-DESCRIPTION OF CREDIT CARDSTUDENTS WOULD PREFER TO USE
More would prefer a card requiring proof of income (37%) than would prefer a card requiring a savings account as collateral (22%)
Card in own name re-quiring
proof of in-come37%
Card requiring savings account as collateral
22%
Card co-signed by parents
23%
Card that is authorized
user of parent's
card18%
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48
-REACTION TO BEING DECLINED OR RECEIVE INSUFFICIENT CREDIT LINE
Most (43%) would use their debit card and re-apply for a credit card if they were declined or received an insufficient credit line
Use debit card, re-apply after gradua-
tion 42%
Apply for a secured card 12%
Apply for card co-signed by parent 12%
Obtain an authorized
user card 9%
Apply for a different card 24%
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49
-IMPORTANCE OF CONCERNS ABOUT HAVING A CREDIT CARD (TOP 2 BOX – “VERY” OR
“SOMEWHAT IMPORTANT”
Students are most concerned about “Worry about making monthly payments” (16%) and somewhat less concerned about “Paying for someone else’s charges” or “Identify theft” (each 11%)
Identity theft
Potential for paying someone else's charges
Spending beyond my means, getting into debt
Worry about making monthly payments
11%
11%
14%
16%
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50
-CREDIT CARDS TOP OF MIND, UNAIDED AWARENESS
When asked which one card comes to mind when thinking about general purpose credit cards or charge cards, about three in ten (31%) mention VISA
NoneBank of America MasterCard
Capital One MasterCardChase MasterCard
Chase VISACitibank Visa
US BankWachovia
Wells FargoWells Fargo Visa
Bank of America VisaCapital One Visa
CitibankDiscover
Bank of AmericaCapital One
ChaseMasterCard
American ExpressVISA
11%1%1%1%1%1%1%1%1%1%
2%2%2%
3%6%
7%7%7%
16%24%
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51
Have%
Have inown
name%
Card isCo-signed
%
Any card 48 38 22VISA 26 25 14
MasterCard 11 11 6American Express 2 2 1
Discover 2 2 1
-CREDIT CARDS OWNERSHIP
48% have access to a credit card (own card or authorized use of someone else’s card)
38% have a VISA, MasterCard, American Express or Discover card in their own name
22% have a co-signed credit card
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52
-WHY STUDENTSDON’T HAVE A CREDIT CARD
The most commonly reported reasons why students don’t have a credit card in their own name are;
1. “Concerned about debt” (26%)
2. “Have no use” (24%)
3. “Parents don’t want me to have” (20%)
4. “Prefer a debit card” (20%) Don't know
Use someone else's when needed
Applied but declined
Use parent's card when needed
Not prepared for responsibility
Prefer a debit card
Parents don't want me to have
Have no use
Concerned about debt
29%
1%
4%
9%
11%
20%
20%
24%
26%
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53Share of
AllCards
%
Share ofVisa/
MasterCard%
Share of
VISA%
Share ofMasterCard
%
BANK OF AMERICA
15 16 18 8
CHASE 14 15 15 13
WELLS FARGO 6 7 8 3
CAPITAL ONE 6 6 6 5
CITIBANK 4 4 2 9
CREDIT UNION 4 4 5 2
US BANK 4 4 5 1
PNC 3 4 4 3
AMERICAN EXPRESS
2 - - -
DISCOVER 2 - - -
-ISSUER OF FIRST CREDIT CARDIN OWN NAME
Based on “first card in own name”, Bank of America is the largest issuer of:
1. All cards
2. All VISA & MasterCard
3. All VISA cards
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54
VISA
MasterCard
Discover
American Express
15%
18%
25%
38%
Top 2 Box, Very/Somewhat likely
-LIKELIHOOD OFCANCELLING CREDIT CARD
AMERICAN EXPRESS cardholders are the most likely to cancel their card in the next 12 months (38%)
VISA cardholders are the least likely to cancel their card (15%)
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55
CREDIT CARDS INTERESTED INOBTAINING IN THE NEXT YEAR
Preference for a particular credit card brand interested in obtaining in the next year correlates with market share None of these
Don't know
Discover
American Express
MasterCard
VISA
56%
21%
3%
4%
5%
13%
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56
-ISSUER WILL APPLY TO FORCARD INTERESTED IN OBTAINING
Among the nearly one in four students (23%) interested in applying for a new card in the next year nearly one in five (19%) will apply to Chase
About one in seven (14%) “Don’t know” who they will apply to Don't know
TD Bank
US Bank
Credit Union
Citibank
Wells Fargo
Capital One
Bank of America
Chase
14%
1%
3%
5%
6%
7%
8%
17%
19%
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57
-REWARDS MOSTINTERESTED IN RECEIVING
By a wide margin, “Cash back” (48%) is the reward students are most interested in receiving
Video downloadsWellness
Rebate for car purchaseSporting goods
Car rentalsCell phone minutes
Points toward electronicsEvent/concent tickets
Music downloadsRestaurant discounts
Gift certificates/cardsHotel discounts/stays
Discounts on airline or hotel ratesTickets to concerts, movies, events
Rebates on gas purchasesPoints toward airline tickets
Cash back
1%1%2%3%4%4%4%4%5%6%6%7%
11%12%12%12%
48%
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58
-ISSUER OF CREDIT CARD(VISA/MASTERCARDS IN STUDENTS’ OWN NAME)
Chase and Bank of America are the largest issuers of all VISA and MasterCard credit cards combined
Bank of America is the largest VISA issuer
Chase is the largest MasterCard issuer
Share ofVISA/MasterCard
%
Share ofVISA
%
Share ofMasterCard
%
Chase 17 18 14Bank of America 17 20 8
Capital One 10 9 10Citibank 7 5 10
Wells Fargo 6 8 1Credit Union 5 6 1
PNC 4 5 1US Bank 3 3 1
Key Bank 2 0 7
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59
-HAVE CHECKING/SAVINGS ACCOUNTWITH ISSUER OF CREDIT CARD
71% with a VISA in there own name have a checking or savings account with the issuer of their VISA card
60% with a MasterCard in their own name have a checking or savings account with the issuer of their MasterCard
Have MasterCard
Have VISA
60%
71%
40%
29%
Have account Don't have account
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60
-CREDIT LIMITS Current credit
limits average $1,688 or nearly twice that of the initial limit
More than eight in ten (85%) are satisfied with their credit limit
Less than three in ten (27%) report an increase in their credit limit in the past year
InitialCreditLimit
CurrentCredit Limit
SatisfiedWithLimit
%
LimitIncreased
In Past Year
%
All cards $849 $1,688 85 27
VISA $801 $1,396 84 29
MasterCard $922 $1,428 85 24
American Express $1,369 $1,888 77 29
Discover $880 $1,228 89 29
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61
-PREFERRED APPLICATION METHOD
Most prefer to acquire their card in person at their bank (29%)
Equal numbers prefer responding to a mail offer, responding to an Internet ad/offer or a Company rep off campus
Don't knowMail offer sent to me at school
Responding to an email offerApp in college bookstore bag
App off campusApp on campus
Calling 800 numberOnline search
Company rep on campusCompany's web site
Company rep off campusResponding to an Internet ad/offer
Responding to mail offerIn person at bank
33%1%1%1%1%2%2%3%4%4%5%6%
8%29%
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62
-REASONS FOR APPLYING FORLAST CREDIT CARD
The most compelling reasons are:
1. “Parents”
2. “Good credit limit”
3. “Have account at bank”
4. “First card applied for”
Don't knowCustomizable features
Card designPremium
Internet featuresTV ad
Entertainment rewardsFrequent flyer rewards
Only offer receivedFriends
Issuing bankLow APR
Card parents usePre-approved status
Cash back rewardsNo annual fee
Greater access to creditFirst card applied for
Have account at bankGood credit limit
Parents
37%2%2%2%2%2%
3%3%
4%4%
5%6%
7%7%
9%9%
10%12%
13%13%
14%
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63
Discover4% American Express
4%MasterCard
23%
VISA70%
-CREDIT CARD OWNED FIRST
Exactly seven in ten students with a credit card in their own name owned a VISA card first
About one in four (23%) owned a MasterCard first and about one in twenty five (4%) owned a Discover or American Express card first
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64
-AGE WHEN ACQUIREDFIRST CREDIT CARD
Seven in ten (70%) acquired their first credit card at age 18 or younger
94% acquired their first card before their 21st birthday
Younger than 18
18%
1852%
1917%
207%
Older than 206%
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65
-MONTH WHEN APPLIED FORFIRST CREDIT CARD IN OWN NAME
Excluding the 35% of students who “Don’t know” what month they applied for their first credit card, (42%) applied during the 3 month period June through August
Don't knowDecemberNovember
OctoberSeptember
AugustJuly
JuneMayApril
MarchFeburaryJanuary
35%1%
3%3%
4%10%
8%9%
6%5%
4%5%
6%
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66
-PREPAREDNESS FOR RESPONSIBILITY OF OWNING & USING A CREDIT CARD
More than eight in ten (81%) believe they were prepared for the responsibility of owning and using their credit card
Very prepared
35%
Somewhat prepared
46%
Not very prepared
13%
Not at all prepared6%
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67
-CREDIT EDUCATION RECEIVEDFROM ISSUER OF FIRST CARD
Nearly half (46%) believe they received enough credit education from the issuer of their first card (about three in ten (29%) received “Very little” or “None”
More than enough9%
Enough37%
Not as much as I would have liked
17%
Very little15%
None14%
Don't know8%
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68
-CREDIT CARD USE
UseMonthly
%
UserMean
Times UsedPer Month
UserMean
AmountCharged
PerMonth
CarryBalance
%
UserMean
Balance
ChargedLate
PaymentFee%
Charged LatePayment FeeMore Than
Once%
Discover 82 11.0 $160 29 $364 22 50MasterCard 81 8.8 $173 32 $788 20 54VISA 89 10.8 $173 35 $655 22 59American Express 71 4.7 $217 14 $1,483 17 0
All cards 86 10.3 $219 33 $695 20 46
86% use their card at least monthly (10.3 times monthly charging $219)
33% carry a balance averaging $695
20% have been charged a late payment fee (46% of these more than once)
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69
-KNOWLEDGE WOULD HAVE LIKED TOHAVE HAD WHEN FIRST OPENED ACCOUNT
About three in ten (31%) “Don’t know” what they would have liked to know about having a credit card when they first opened their account
Other than “Don’t know”, the most common response is “How card affects credit rating” (17%)
Don't knowHow to get more info about account
Who to contact with a problemRisk of identity theft
Card's rewardsHow to pay bill
Card basicsCard's grace period
Importance of paying on timeHow to manage account online
Credit limitCard fees such as over limit
Card's interest rateHow to manage spending
How card affects credit rating
31%6%7%7%9%10%11%11%12%12%12%
15%16%16%17%
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70
-AGREEMENT WITH STATEMENTS
Parents have a significant influence on students and their credit card
About one in four believe their school is “too pushy” about promoting a credit card with the school logo on it “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 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"
22%
53%
54%
61%
64%
67%
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71
-CREDIT CARD USED MOST OFTEN
The brand of credit card used most often correlates with each brand’s overall share
Discover5%
Amercian Express
3%
MasterCard24%
VISA68%
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72
-ISSUER OF CARDUSED MOST OFTEN
Bank of America (16%) is the most frequently mentioned issuer of “credit card used most often”
Chase (14%) and Capital One (7%) follow
Don't knowKey Bank
First FinancialAmerican Express
DiscoverUS Bank
PNCCredit Union
CitibankWells FargoCapital One
ChaseBank of America
6%2%2%2%
3%3%
4%5%5%
6%7%
14%16%
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73
-INTEREST RATESAbout half (49%)
know what the interest rate for their card is (average of 11% among those reporting)
About one in eight or 13% experienced a rate increase within the last 1 to 6 months (51% “Don’t know” when they last experienced a rate increase) Don't know
Never increased
No increase last year
Within last year
Last six months
Last three months
Last month
51%
19%
10%
12%
3%
5%
3%
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Don't knowSupport school or org
Special incentives to sign upCard design
Card my friends useOffers rewards points
Like their customer serviceFirst card I see in my wallet
Brand I preferBrand I trust
Has available creditLow APR
Offers cash backWidely accepted
Higher credit limitCard my parents use
Most convenientFrom my bank
First card obtained
13%1%1%1%1%
2%3%3%
4%5%5%5%5%5%
6%8%8%
14%21%
-WHY USEONE CARD MOST OFTEN
“First card I obtained”, “From my bank”, “Most convenient” and “Card my parents use” are the most common reasons why students use a particular card most often
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75
-FREQUENCY OF USINGCARD USED MOST OFTEN
Half (50%) use their card weekly or more often
About one in five (21% use their card once a month or less often
Daily9%
Several times a week24%
One a week17%
A few times a month
23%
Once a month
9%
Less of than
monthly12%
Don't know9%
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76
-CREDIT CARD SOLICITATIONS
In a typical month, students are most likely to receive a credit card solicitation via U.S. Mail (59% received at least 1) and least likely to receive a solicitation via a tele-marketer (17% received at least 1)
ReceiveAny% Average
U.S. Mail 59 3.1
eMail 39 3.7
Tele-marketer 17 4.5
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77
AppliedFor Approved Activated
None 86% 35% 18%1 9% 53% 72%
2-3 4% 10% 9%4-6 1% 2% 2%
Total Mean .2 .9 1.0User Mean 1.7 1.3 1.2
-CREDIT CARDS APPLIED FOR,APPROVED & ACTIVATED
Among the 14% applying for a credit card, 65% were approved and 88% of the approved cards were activated
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78
-FIVE MOST IMPORTANTCARD CHARACTERISTICS/FEATURES
The five most important card characteristics or features are:
1. Accepts payment online
2. Can be used at ATM machines
3. 24 hour toll free customer service
4. Card for college students
5. Can view account online
Free checking with cardHigh credit limitLow annual fee
Track spending onlineEasy approval
Encourages responsible useFrom my bank
Rewards I wantDiscounts at stores/restaurants
Don't have to pay in fullCan use as ID for check cashing
Good overal valueAuto payment from checkingConvenient accesses to cash
Discounts on travelNo annual fee
Wide acceptanceLow annual fee
Airline milesCash back rewards
Can get in own nameCan view account online
Card for college students24 hour toll free customer service
Can be used at ATM machinesAccepts payment online
6%6%6%6%
7%7%7%7%
8%9%
10%11%
13%13%
14%14%14%
16%18%
22%27%
32%32%
33%34%
38%
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79
-THREE MOST IMPORTANTCARD DESIGN ATTRIBUTES
The three most important card design attributes are:
1. Photo on card for ID purposes
2. Cool design
3. Customized with choice graphics, photo
Contactless
Mini card
Photo on card I choose
Associated with brand or organization I identify with
Customized with choice of graphics, photo
Cool design
Photo on card for ID purposes
9%
9%
16%
18%
22%
26%
31%
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80
-AGREEMENT WITH STATEMENTS
% Completelyor Somewhat
Agree
“It is my responsibility to keep track of how much I spend with credit cards” 65
“Credit cards encourage me to spend too much” 63“I am responsible enough to have a credit card in my own
name” 58“Credit card companies should do more to teach students
how to use credit responsibly” 55“My parents taught me how to use credit responsibly” 53
“Credit card issuers are too aggressive in marketing their cards” 52
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81
-AGREEMENT WITH STATEMENTS
% CompletelyOr Somewhat
Agree
“I use my credit card for emergencies only” 44“Credit cards give me more consumer security in making
purchases than cash or checks” 36“I do use or would use my credit card for recurring payments
such as payments to cell phone providers, utilities, cable, etc.” 36“Credit cards allow me to manage my spending more
effectively than cash or checks” 34“My college provides me with resources to use credit
responsibly” 31
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82
-ACCOUNTS CLOSED IN THE PAST 12 MONTHS
14% of students closed 1 or more accounts in the past 12 months
Students were most likely to have closed a checking account and least likely to have closed a credit card account
None of these
American Express credit card
Discover credit card
MasterCard credit card
VISA credit card
Savings account
Checking account
86%
1%
1%
1%
3%
6%
9%
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83
-BANK WHERE CLOSED . . .
Checking Savings VISA MasterCard*Bank % Bank % Bank % Bank %
Bank of America 25 Bank of America 20 Chase 23 Chase 17
Chase 11 Chase 12 Capital One 15 Capital One 17
Credit Union 6 Credit Union 8 Bank of America 12 Key Bank 17
Citibank 5 Key Bank 5 Citibank 12 US Bank 8
Key Bank 4 Wells Fargo 5 Wells Fargo 8 Citibank 8
Those closing a Checking or Saving account were most likely to have closed a Bank of America, Chase or Credit Union account
Those closing a VISA account were most likely to have closed a Chase, Bank of America, or Capital One VISA account
Those closing a MasterCard account were most likely to have closed a Chase, Capital One or Key Bank MasterCard account
* CAUTION: Small Sample
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84
-CAMPUS CARD OWNERSHIP 40% have a
Campus Card
Among the 40% with a Campus Card, 19% report their Campus Card has a bank logo on it
Have Campus
Card40%
Do not have
campus card60%
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85
-DESCRIPTION OF CAMPUS CARD Among the 40%
with a Campus Card, 68% have a campus card that acts as a Student ID, provides building access and serves as a stored value card
Student ID only18%
Student ID and building
access14%
Student ID, building ac-
cess and stored value
68%
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86
-IMPORTANCE OF SCHOOL PROVIDING CAMPUS CARD
Nearly nine in ten (85%) 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 88% among students living on campus to a low of 63% among students living at home and commuting to school
Very unimportant
Somewhat unimportant
Neither
Somewhat important
Very important
1%
2%
8%
22%
62%
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87
-LOCATIONS WHERE SCHOOL ISSUEDCAMPUS CARD IS USED TO MAKE PURCHASES
Students are most likely to use their school issued Campus Card in the;
1. “Dining Hall” (95%)
2. “Other on campus restaurants” (71%)
3. “Campus bookstore” (70%)
Laundry machines
Vending machines
Printers or copiers
Campus bookstore
Other on campus restaurants
Dining hall
51%
59%
63%
70%
71%
95%
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88
-FREQUENCY OF USING CAMPUS CARD TO MAKE PURCHASES
Among those whose Campus Card serves as a stored value card, 92% use it to make purchases
73% use it to make purchases weekly or more often
Daily42%
Several times a week23%
About once a week
8%
A few times a month
8%
Less than once a month
9%
Never8%
Don't know2%
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89
-AMOUNT SPENT WITH SCHOOL ISSUED CAMPUS CARD IN A TYPICAL MONTH
Among those whose Campus Card serves as a stored value card, 96% use it to make purchases and spend an average of $88 monthly
One in five (20%) spend more than $100 monthly
About four in ten (39%) spending more than $50 monthly
Nothing4%
$10 or less23%
$11 to $2512%
$26 to $5022%
$51 to $10019%
$101 to $20012%
More than $2008%
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90
-NUMBER OF PURCHASES MADE WITH SCHOOL ISSUED CAMPUS CARD IN A TYPICAL MONTH
Among those whose Campus Card serves as a stored value card, 96% use it to make purchases making an average of 18 purchases monthly
About one in four (24%) make more than 25 purchases monthly
None4%
10 or less51%
11 to 2521%
26 to 5019%
51 to 754%
More than 751%
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91
-PERCENT OF SPENDING WITH SCHOOL ISSUED CAMPUS CARD ON CAMPUS VERSUS OFF CAMPUS
68% of students spend 100% on campus (highest among students living at home and commuting to school at 74%)
38% of students spend some portion with their card off campus (highest among students living off campus at 44%)
Among the 38% spending off campus, 31% of spending is done off campus
Total%
OnCampus
%
OffCampus
%
AtHome
%Spending on campus . . .
None 3 0 7 4 1% to 25% 3 1 7 0 26% to 50% 11 7 17 15 51% to 75% 3 4 1 0 76% to 99% 12 16 6 4 100% 68 72 62 74Spending off campus . . .
None 62 64 56 74 1% to 25% 13 18 6 4 26% to 50% 10 7 15 15 51% to 75% 3 2 5 0 76% to 99% 2 1 6 0 100% 3 1 6 4
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92
-IMPORTANCE OF BENEFITS OFSCHOOL ISSUED CAMPUS CARD
The highest rated benefits of a school issued Campus Card are:
1. “Convenience” (76%)
2. “Don’t have to carry cash” (68%)
3. “Already pre-paid” (66%)
Can access different pools of funds
Parents pay for it
Provides record of spending
Helps control spending
Only need to carry one card
All on and off campus financial needs satisfied
Already pre-paid
Don't have to carry cash
Convenience
44%
44%
53%
55%
56%
56%
66%
68%
76%
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93
-INSURANCE/INVESTMENT PRODUCTSOWN & PLAN TO PURCHASE
“Car insurance” is
The most commonly owned insurance or investment product
The product students were most likely to make the purchase decision for
The product students are most likely to purchase in the next year
Tuition insurance
Travel insurance
Home Owners insurance
Renter's insurance
CD's
Life insurance
Student loan insurance
Savings bonds
Car insurance
1%
2%
1%
2%
1%
1%
2%
1%
1%
1%
3%
3%
1%
4%
2%
5%
8%
1%
1%
1%
1%
1%
1%
2%
2%
3%
3%
5%
4%
5%
5%
9%
14%
14%
Own Plan to purchase
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94
-HEALTH INSURANCE
46% report their schools requires them to have health insurance
One in twelve (7%) “Don’t have health insurance”
Two in three (65%) of all students are part of their “parent’s policy”
Don't know
Don't have health insurance
Through spouse
State subsidized policy
Through job
Medicare/Medicaid
Through school
Parent's policy
10%
7%
1%
1%
3%
7%
9%
65%
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95
-STATEMENTS ABOUT RISK
Small numbers (less than one in five) regard themselves at “High risk” for any of five accident, illness or theft related experiences
Somewhat more regard themselves at “High risk” for “Identify theft” than for an “Auto accident” or “Loss of personal property”
Auto accident
Loss of personal property
Hospitalization for accident
Hospitalization for illness
Identify theft
15%
16%
16%
17%
20%
24%
27%
27%
19%
17%
34%
35%
35%
29%
33%
15%
14%
14%
17%
15%
11%
7%
7%
17%
15%
Highest - 5 4 32 Lowest -1
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96
-“IN THE PAST TWO YEARS, I HAVE OR HAVE HAD A CLOSE FRIEND…”
Students are more likely to have been or know someone who has been hospitalized or involved in an auto accident in the past two years (44% and 37% respectively).
One in eight (13%) has had to withdraw from school in the middle of the semester or knows someone who had to withdraw for a medical emergency or death in the family
Suffered injury requiring hospitalization or medical attention
Withdraw for a medical emergency
Victim of identify theft
Required medical attention
Victim of loss of personal property
Involved in an auto accident
Hospitalized
6%
13%
20%
26%
28%
37%
44%
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-“IN THE PAST TWO YEARS, I HAVE OR HAVE HAD A CLOSE FRIEND…”
Students generally report a perceived lower level of risk of experiencing an illness, accident or form of theft than they report actually having personally experienced or knowing someone else has personally experienced in the past two years
Suffered injury requiring hospitalization or medical attention
Victim of identify theft
Victim of loss of personal property
Involved in an auto accident
Hospitalized
44%
20%
28%
37%
44%
40%
36%
43%
39%
34%
Risk Experienced
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-WHERE MOST LIKELY TO PURCHASE INSURANCE PRODUCTS
More than four in ten (45%, and the largest group) “Don’t know” where they are most likely to purchase insurance products
About one in three (32%) are most likely to purchase insurance products from “a local insurance agent”
Don't know45%
Other10%
Local in-surance agent32%
Internet in-surance web-
site5%
Government assistance program4%
Multi-product insurance website3%
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-PAYING FOR COLLEGE More than six in
ten are “Confident in my ability to repay my student loans according to the terms and conditions”
About half believe their “school’s financial aid office was helpful in identifying ways to pay for college”
"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"
36%
37%
28%
36%
13%
15%
27%
25%
49%
53%
55%
61%
TOP 2 Box Completely agree Somewhat agree
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-INFLUENTIAL SOURCES ABOUTPAYING FOR COLLEGE
By a wide margin, “Parents” (72%) are the most influential source of information about paying for college Affinity group
High school seminarInformation in the mail
BankStudent loan company
FriendsHS guidance counselor
InternetRelatives (not parents)
Financial aid officeParents
14%22%28%31%32%36%37%42%44%53%72%
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-AMOUNT OF UNDERGRAD STUDENTLOAN DEBT EXPECT TO HAVE
Among the 69% of students anticipating having some student loan debt, the average amount is $26,450
None31%
$1 to $10,00027%
$10,001 to
$20,00015%
$20,001 to $25,000
4%
More than $25,000
23%
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-LIKELIHOOD OF CONSOLIDATINGSTUDENT LOANS
Nearly half (46%) plan to consolidate their student loans
About three in ten (31%) “Don’t know” if they will consolidate their student loans
Very likely24%
Somewhat likely22%
Neither9%
Somewhat unlikely
5%
Very un-likely
9%
Don't know31%
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Govern-ment loan
56%
Private loan20%
Loans direct from school20%
Relatives14%
Credit card3%
Friends2%
Other5%
-SOURCES OF STUDENT LOANS
More than half of student loan debt is from government (56%, up from 53% last year) while 20%, 18% last year, of student loan debt are private, alternative loans
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-YEARS REQUIREDTO REPAY STUDENT LOANS
On average, students believe it will take 7 years to repay their student loan
Half (50%) believe it will take more than 5 years to repay their student loan
About one in eight (12%) believe it will take more than 10 years
5 years or less50%
6 to 10 years37%
More than 10 years
13%
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FALL 2011 TIMETABLELIFESTYLE & MEDIA, COMPUTING & THE INTERNET
16th DraftQuestionnaireDistributed
12th ToplineDistributed
17th Final Report,PresentationsBegin
8th In Field
AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER
12th Comments,Proprietary Questions Due
20th QuestionnaireFinalized