Originally published January 25 2005
Students in New Jersey may need their parents' permission before getting a credit card
by Mike Adams, the Health Ranger, NaturalNews Editor
A new bill in New Jersey is calling for students to get their parents' permission before obtaining a credit card. The proposal, which was approved by the Assembly Consumer Affairs Committee, is designed to get parents involved in the credit decisions of their youth and to help guide them financially. Parents will not become legally responsible for their child's credit card debts, but will become more involved in their children's overall financial planning.
At age 18, New Jerseyans can legally buy cigarettes, lease an apartment, even get an abortion, but a bill endorsed Monday by an Assembly committee would make it illegal for some young adults to finance such acts using a credit card not approved by a parent or guardian.
With credit card companies soliciting college students on campuses with offers of free T-shirts, mugs and key chains, it is difficult for parents to monitor the credit records of their children, said Assemblyman Neil M. Cohen, D-Union, the bill's sponsor.
"Ensuring that parents are involved in the credit decisions of 18- to 21-year-old students will help young consumers make wiser decisions about how to spend their money," Cohen said.
The proposal -- approved 3-2 by the Assembly Consumer Affairs Committee -- calls for individuals under 21 years of age to obtain parental consent before obtaining a credit card.
Parents are under no legal obligation to pay off a child's credit-card debt, Cohen said.
More than 80 percent of college students have credit cards, while almost half of all students own four or more, according to a 2001 study by student lender Nellie Mae.
The average credit card balance is roughly $2,300, the study found.
"Typically the cards that are offered to students do have higher interest rates and don't usually have large credit limits," said Jim Tehan, a spokesman for Myvesta, a nonprofit consumer education organization in Rockville, Md.
Critics of the proposed bill argued that in order to make major purchases in the future, young adults need to build a credit record.
"I think there are going to be a number of parents who say no," Tartaglia warned.
Assemblyman Jon M. Bramnick, R-Union, one of two Republicans who voted against the measure, agreed.
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