While college students sometimes get a bad rap for being entitled or irresponsible, when it comes to managing their money many of them are doing it right.
More than three-quarters of college students pay their bills on time, more than half are setting aside savings each month, and two-thirds have a paying job, according to a new report from Sallie Mae. Among those who have credit cards, 63 percent pay off their cards each month, and 73 percent pay their bills on their own.
While they’re building good habits, many college students nevertheless lack an understanding of the way that credit works. Sallie Mae asked students three basic credit questions about interest accumulation (see below), and fewer than a third of students answered all the questions correctly.
The likelihood of students getting all three answers correct decreased with age. A third of those ages 18 to 20 aced the quiz, compared to a quarter of those ages 23-24.
The students who rated their money management skills as excellent were the least likely to get all three questions right.
Students cited parents as their biggest money influence, with 71 percent saying they had learned money management from their mom and dad. Among those surveyed, 22 percent had learned about personal finance in high school and 12 percent had taken a college course in the subject.