Yet another item has been added to the off-limits list for those younger than 21 years old. President Barack Obama’s newest form of change involves credit card reform with questionable solutions and new limitations for college students.

As of May, Obama signed the Senate version of the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act of 2009 8212; the first attempt to reform unfair practices of credit card companies in, well, ever. With Americans paying an estimated $15 billion in penalty fees each year, this bill is expected to both improve the economy and educate Americans about smart credit.

Because of the reforms, credit card companies will have to provide plain and clear policies while giving the credit card holders more power. While these reforms are intended to further protect consumers, some see it as inhibiting access to vital lines of credit.

For citizens not yet 21 the bank has to verify their ability to pay the bill, very similar to rules regarding loans. The group most affected by this change is college students. It prevents them from using this method for paying ancillary expenses associated with college, including books, food and gas. This policy change will make students rely on federal grants, loans or scholarships 8212; three alternatives that aren’t as easy to attain.

Irresponsibility is an underlying factor that has ushered in this reform. This act facilitates the debt paying process and encourages more fiscal responsibility. Although the credit card system is flawed, many students and Americans with limited incomes rely on it.
Credit card companies have relied on unfair practices such as retroactive rate increases, fee traps, small print and fluctuating due dates.

Even though the suggested changes put the customer first, it does not mean the customers will be running their own policies. Facilitated economic issues come with more responsibility.

Fees may still be charged for late payments, but more time will be given between statements to ensure payment. At least 21 calendar days from the time of mailing must be given for payment. Also, the companies will have to remind the payer of the total amount owed and inform them of any changes made to their assigned date, something that was not done before. The new law will ban over-the-limit fees, sub-prime fees and double-cycling, allowing card holders more freedom to manage their money without being penalized for the amounts.

Choosing to pay the minimum amount necessary has given credit card holders an easy alternative to keeping their credit card debt at bay. This tendency, however, has allowed credit card companies to increase their revenue. While a person is paying the minimum thinking they are right on track with their bills, they actually are not.

Companies are not required to provide its customers with timelines, but with the new laws this will change. Companies will be required to inform customers about how long it would take them to pay off their balance ranging from 12 to 36 months.

Although these changes won’t take effect until next February, credit card companies have already started to change their policies in hopes of taking a smaller hit from these new laws. It is expected that credit card companies will make a greater push to recruit new customers before mandatory changes actually begin.

At the end of this reform, credit cards will become easier to use, will aid responsible holders and help those needing more assistance paying off debt.

Credit cards began as a source of convenient spending but have evolved into an economic necessity for a cash-strapped economy, especially for college students who often live from paycheck to paycheck.

For credit card holders in debt, this has been a great win. For cash-strapped college students, this may limit their ability to afford textbooks or food between paychecks. Hopefully net changes will result in a more responsible, financially prudent consumer base. Still, some students just can’t afford to be responsible.

8212;Aileen Pantoja is a zoology freshman.

8212;This column does not necessarily reflect the opinion of The Daily Aztec.