A Mountain of Debt
Study Finds Quebecers Have an Unrealistic Perception of Their Financial Situation
The Quebec Coalition of Consumer Associations released a survey last Wednesday that indicates credit card owners have skewed perceptions of the reality of their debt, and unless something is done to educate people, the situation will only get worse.
While 91 per cent of the 1,034 people who answered the QCCA’s survey believe that their financial situation is completely under control, seven per cent have trouble making the minimum payment on their credit card every month and a whopping 58 per cent have had trouble making that minimum payment at least once in the past year.
“The credit card is used for every kind of expense. This is what we think is a problem. People think it’s normal and then they don’t pay their bills. They think ‘I can only put a small amount and it’s ok with the bank, so why not do it? I can use my money for other expenses,’” said Michèle Goyette, the spokesperson for the seventh edition of Mordu du credit? Dans la marge jusqu’au cou!
The campaign aims to raise awareness about credit card debt, especially among 14-to-21 year-olds, who are regular targets for credit card companies’ advertisements.
About 25 per cent of Quebecers in this age group have been persuaded by these companies, and contrary to what Goyette would like to see, the number is rising.
“We hope that it will become harder for companies to reach young people to offer them credit. They know what they have to do if they want a credit card—they just have to go to the bank,” said Goyette, suggesting the advertising methods used by credit card companies are unfair.
Young adults are a target audience for more advertisers than any other age group, and since many don’t have steady jobs, they can’t afford the material goods they want unless they put it on credit, said Goyette.
Schools, she added, seem blind to students’ growing financial woes.
“Each institution can decide to refuse to let a company come into their school, but it doesn’t happen very often. So for now, they are free to do whatever they want and to offer their products to everyone,” said Goyette, adding that she is working to get a law against advertising credit to young adults.
This law would mean that schools could not let the credit card companies into their buildings to advertise to their students as they do now. Goyette would also like to see schools offer a more comprehensive courses in economics to their students.
“We hope that schools will be more aware of this situation and we’re also trying to do activities in schools to prevent the use of credit and help students know more about money and budgeting,” Goyette said.
The Mordu du credit? Dans la marge jusqu’au cou! campaign started on Nov. 22 and will end on Buy Nothing Day on Friday, Nov. 26.
Quebec Coalition of Consumer Associations’ website, www.cacq.ca
This article originally appeared in The Link Volume 31, Issue 15, published November 23, 2010.
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