A third of students overspending every few months, one in ten every month
One in five planning on applying for a new credit facility in the near future
London, UK, 9 September 2013 - A third of students admit to being financially unprepared for university living, new research from Experian CreditExpert has revealed.
The nationwide survey published today with responses from 2,000 students and recent graduates also discovered that 67% of students and graduates want to know more about managing their finances highlighting a lack of financial preparation and support. While nine in ten students have some form of credit outside their student loan– mainly either an overdraft or credit card, poor credit management is already evident which could negatively impact on future financial independence.
Experian Student Money Matters research findings:
In light of the findings and ahead of the new term, Experian has launched the Students and Young People credit guide, available for download at: www.experian.co.uk/students
The Experian guide for Students and Young People is designed to help students and graduates start their professional lives in a much stronger position by understanding how to use credit wisely to achieve the things they want in life.
Peter Turner, Managing Director at Experian Consumer Services, UK & Ireland said: “It’s easy to get distracted by the size of student/ graduate loans and overdrafts, but all credit needs to be repaid at some time and understanding the basics of good credit management will help get on the right track to financial independence. A missed payment on a bill, a store card, a graduate loan, or exceeding an agreed borrowing limit, remains on a credit report for six years and what might seem like a minor detail now could impact on your creditworthiness when you are hoping for your first car loan or even mortgage”
What every student needs to know about credit:
How it all works
When you start using credit facilities, such as overdrafts, credit cards and even mobile phone contracts, information on how you manage these credit facilities will appear in your credit report. Your credit report will help lenders access your credit worthiness into the future based on how well you have managed credit over the last six years.
Building up a picture
When you apply for credit, your name and address will be checked against the electoral roll so that the lender can be sure that you are who you say you are and live where you say you live. Whatever you do, it is essential you register to vote somewhere, even at your parents’ home and give that exact address when you apply for credit.
Information about other people
Your credit history can only be linked to other people if you have a financial link with them. Paying the rent together doesn’t count, however, you will be linked to people you share with you if you put multiple names on a credit agreement such as an electricity bill.
Think before you borrow
If you are a student, you’ll probably take advantage of one of the special bank accounts on offer many of which include interest-free overdrafts, but remember that you will need to pay the money back when your course ends. Never go over your overdraft limit without permission from your bank. Always speak to your bank if you are struggling.
Don’t forget to budget
To build up a good credit history you must make all your payments on time. How you manage any credit you have now will affect your chance of getting credit in the future. So use credit wisely and budget to make sure you don’t spend too much.
For more information and advice on student finances visit www.experian.co.uk/students
Notes to editors:
Research was carried out online by eDigitalResearch on behalf of Experian CreditExpert among a panel of 2008 current undergraduates and graduates in the last 12 months in July 2013.
For more information please contact:
Experian Consumer Services
Joanne Leahy, PR Manager - 020 3042 4089 / Joanne.firstname.lastname@example.org
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Experian is the leading global information services company, providing data and analytical tools to clients around the world. The Group helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.
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