National Survey Reveals Gap Between Students` Financial, Lifestyle and Career Expectations and Post-Graduation Reality; Also Disconnect Between Perceived Credit Knowledge and Real Financial Facts
NEW YORK--(COLLEGIATE PRESSWIRE)--Apr 18, 2005--According to the second annual survey by Citi Credit-ED(R), Citi`s award-winning financial literacy program for young adults, the nation`s college upperclassmen today have high financial and lifestyle expectations immediately after graduation, combined with a hearty appetite for consumerism. And while soon-to-graduate college students are optimistic about their future, survey results show a gap between perceived and real credit knowledge.
An Optimistic Financial Outlook
Results of the Credit-ED survey conducted by Harris Interactive reveal that today`s college upperclassmen are more optimistic about the U.S. economy than last year and for the coming year than young adults, baby boomers and mature adults. College juniors and seniors are more optimistic about achieving early financial independence � despite the fact they expect no higher salary and just a slight decrease in the amount of debt compared to last year. The survey also finds that, after graduation, upperclassmen plan to spend their disposable income on themselves for instant gratification buys rather than retirement:
* About two in five (42%) upperclassmen expect to be financially secure � that is, afford the lifestyle they want with little debt -- within three years after graduation, compared to a third (35%) a year ago.
* Similar to last year, about three out of five juniors and seniors today expect to have no credit card debt upon graduation and a year after graduation.
* 22% of upperclassmen plan to spend leftover money on entertainment or personal items, compared to 15% last year.
* Only one in five (22%) upperclassmen plan to save or invest any money left over after expenses, compared to 30% last year.
After graduation, many college students may encounter a different reality when it comes to their financial situation. According to a recent Time magazine poll, among adults aged 21-29, nearly half (46%) are concerned about making ends meet. Only 15 percent of these adults say they are ``most of the way`` to being fully independent of their parents or relatives; 20 percent are just getting started.
Credit Knowledge and Credit-Related Behavior
While the Citi Credit-ED/Harris Interactive survey finds that the majority (90%) of college upperclassmen today recognize and value good credit as an important financial goal, their credit-related behavior tells a different story:
* The majority of upperclassmen (72%) have not requested a copy of their credit report.
* About a third (32%) have missed or been late on a credit card payment.
* A quarter (24%) have written a check that bounced.
Furthermore, most upperclassmen (80%) feel knowledgeable enough to manage their finances after graduation, yet almost half of those who feel knowledgeable still make significant credit mistakes, revealing that more financial education is needed:
* Just over half (52%) believe their spending habits now will NOT impact their credit report in the future.
* Over a third (37%) think opening unnecessary, new credit cards will NOT lower their credit score.
* Nearly three in ten (28%) do NOT save money for future purchases.
* Nearly a quarter (22%) think using a debit card will help them build a credit history.
``These survey findings tell us that there continues to be a gap between students` perception vs. reality when it comes to credit and financial knowledge,`` said Amer Sajed, Senior Vice President, Citi Cards. ``Citi is committed to providing ongoing comprehensive, interactive and engaging resources so that students learn and adopt healthy credit and saving habits early to prepare them for life after graduation and help them achieve financial security.``
Interactive Credit Education Resources
Nearly a quarter of college juniors and seniors (24%) currently feel strongly that they need to know more about wise credit management. And this is a good thing, since it appears college students -- especially those scheduled to graduate within the next two years -- are going to encounter a different future than the one they envision today.
To help students manage their finances wisely in the ``real world,`` Citi`s Credit-ED program provides young adults with all the resources and support they need to help ensure a healthy financial future. The Credit-ED website just for students, www.Students.UseCreditWisely.com, offers a wealth of free financial education information to spend wisely, learn the ABCs of credit and protect themselves from fraud.
The site also features interactive tools including the Budget Builder, an easy-to-use, step-by-step guide to creating a personalized spending and savings plan; the Spend Wisely Challenge that assesses a student`s financial IQ; and two Use Credit Wisely and Know When to Stop mini-movies.
Recently, Citigroup and the Citigroup Foundation announced a 10-year, $200 million global financial education commitment, the formation of a new Office of Financial Education and a global initiative designed to encourage its 300,000 employees around the world to devote time to support financial education and other charitable causes. Under the new initiative, employees may take a day off from work to volunteer for non-profit organizations in their communities.
Survey Methodology
Total sample includes 1,060 U.S. college juniors and seniors at a 4-year college or university. All interviewing was conducted on-line using The Harris Poll Online database during January 7-19, 2005. The margin of error is +/- 3.1 percentage points.
About Credit-ED
Credit-ED is part of Use Credit Wisely, Citi�s ongoing comprehensive credit education program that provides free financial tools to help people of all ages, backgrounds and economic levels develop healthy credit habits. In addition to Credit-ED, Use Credit Wisely also encompasses Hablando de Cr�dito, Citi`s credit education program for the Hispanic community, and www.Credit-EDAdministrator.com for college administrators to help guide their students to financial ``smarts``.
About Citi Cards
Citi Cards, or Citi, is a member of Citigroup (NYSE: C). Citigroup, the leading global financial services company, has some 200 million customer accounts and does business in more than 100 countries, providing consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, insurance, securities brokerage and asset management. Major brand names under Citigroup`s trademark red umbrella include Citibank, CitiFinancial, Primerica, Smith Barney, Banamex, and Travelers Life and Annuity. Additional information may be found at www.citigroup.com.
Media Contacts:
Robin Dolch, Celene McDermott
TMGpr
212-750-5755
Liz Fogarty
Citigroup
212-559-0486
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Editor`s Note: To receive a copy of the complete survey, please contact Robin Dolch or Celene McDermott: [email protected]; [email protected]; 212.750.5755
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