Maria will be a college sophomore next year, and she is determined to have her own credit card. She will not be employed during the school year but is convinced that she can qualify for a card based upon her summer earnings. Maria's parents have read a number of articles about the problems of credit cards and college students, including examples of students leaving school after a downward spiral of credit cards, overspending, working to pay bills, worrying about bills, working more hours to pay bills, and eventually withdrawing from school. 

When Maria showed up with a handful of applications including Visa, a Gold MasterCard, Discover, a Visa sponsored by her university, an American Express, a secured MasterCard, and a gas company card, her parents were overwhelmed. Maria admitted she didn't want them all. "I'm not stupid," she declared. Since Maria obviously needed to learn about credit cards, her parents agreed to co-sign her application on one condition. She had to approach her choice just like a class project and research the following questions:


1. Assuming Maria does not really care about her parents' approval and ignores their assignment, will she be able to apply for a credit card without their help? Hint: Consider the application process and the five C's of credit. How important are Maria's summer earnings in determining whether or not she is issued a card?

2. Why would an unemployed college student possibly need a credit card? What are the advantages to having a credit card? What are the disadvantages?

3. Should Maria have more than one card? What is the recommended number of credit cards for the average consumer?

4. Shopping for credit can be compared to shopping for any other consumer product--consider the product cost, features, advantages, and disadvantages. In other words, does the product meet the user's needs? Help Maria compare her credit choices given the applications she has collected.

5. Based on the analysis in question 4, what credit card class(es), if any, should Maria seriously consider? For what other "products," if any, might she consider applications?

6. List and summarize the basic factors that affect credit card costs. Rank these factors in terms of importance and relevance based on Maria's situation.

7. While comparing the applications she had collected, Maria was thrilled to receive a "preapproved" offer for a standard card. What precautions should Maria be alert to with this offer?

8. In order to convince her parents that she can be responsible when using a credit card, Maria volunteered to use a credit tracking system. How should she explain this method to her parents?

9. To avoid problems, what might be considered the most important rule for Maria to follow when using a credit card?

10. How might Maria's credit card use impact her future job search? What should she do to avoid any problems?

11. What steps, such as purchasing credit card insurance, should Maria take to protect herself against fraud?