New credit card law affects those under 21

Getting a free Gator T-shirt and a piece of plastic that allows you to spend thousands of dollars on whatever you want is too good to be true and sometimes too good for teenagers to face the real facts.

Over the years, college students have been the main targets for credit card companies. When receiving cards with large limits, teens without a steady income and ignorance of the consequences quickly realize they are in trouble.

Monday, the Credit Card Accountability, Responsibility, and Disclosure Act of 2009 (CARD) took effect.

A part of this new legislation requires anyone who wants to own a credit card to be 21, have an adult co-signer or show that you have a job and steady income. It also made several other changes to give an overall better understanding for consumers.

Ross Jones, assistant manager of Campus USA Credit Union, deals with a lot of college students and is excited about the change.

“You can’t just fill in your name and get a card anymore,” Jones said. “Those days are gone.”

The law requiring users to be 21 to get a card is a good idea for some, but not so much for 19-year-old Gainesville local, Megan Kose.

“It’s a huge inconvenience for me, only being 19,” Kose said.

Jones said the new legislation was brought on in part because of issues with credit card companies, but with users as well.

The economy played a part in the change because people are spending more than they can pay for, said Andrea Moore, communications manager at Card Services for Credit Unions.

Both Jones and Moore emphasized the importance of building good credit by putting what you can in your name while avoiding debt as much as possible. Racking up debt affects your future lending options, such as buying a house or a car, and just causes problems in general.

“Debt is a necessary evil,” Jones said. “When you have a job and no debt, you have 100 percent control over your paycheck. Once you have debt, you're no longer in control.”

Kate Hall, a 22-year-old theatre major at UF, doesn’t own a credit card yet because she knows it could get her in trouble. She doesn’t plan to get one until after college.

“I’m not in debt yet and I don’t plan to be,” Hall said.

Another aspect of CARD requires credit card issuers to tell how long it would take card holders to pay off credit card balances if they make minimum payments each month.

“This disclosure will really open peoples’ eyes,” Jones said. “I think it’s the most important part of this new legislation.”

This will give parents an opportunity to explain to their children the importance of being responsible with their card, Moore said.

“You need to have an honest look at what you can afford.”