written by: Terry Caron•edited by: Amanda Grove•updated: 9/1/2011
The demographic profile for today's college students has changed significantly over the past few years. College students are typically in their mid twenties and work part time jobs.
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Today's College Student
A few decades ago the typical age for college students was eighteen to twenty-one. Today more students are in their mid-twenties and work part time jobs. This creates a larger amount of disposable income for college students and the stereotypical, starving student, doesn't apply like it did a few years ago. With this in mind, did the spending habits of college students change over the years as well?
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Money on Food Expenses
Although ramen noodles aren't a staple in the average college student's diet, college student spending habits still focus on food. Over 11 billion dollars was spent on snacks and beverages last year alone. Even though many colleges have meal plans that provide inexpensive meals for students, a great portion of their spending dollars still goes towards eating out. Students today spend over one hundred dollars a month on coffee alone.
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Technology is a Staple
Next to food, college students spend a great deal of money on high tech gadgets and devices. Over 90 percent of college students have a desktop or laptop computer. Of this 90 percent, 65 percent have broadband internet connections. This, along with television, cable, cellular phones and their plans, iPods and other gadgets absorb a significant amount of a college student's disposable income. A common problem that arises from spending on technology is found when students continue upgrading to the latest and greatest technologies. Having the latest mobile devices, apps and music not only costs money up front but leads to additional spending. Spending additional money for music, and applications for new devices can put further demands on a college students already limited budget. Other influential devices coming into the market are the Ipads, kindles and other mobile computing devices that may soon replace those laptops and desktop computers.
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The next expenses, waiting in line for the college student's money, are the entertainment markets. Over three billion dollars is spent annually on entertainment such as movies, DVD's, music and video games. Over six hundred million dollars every year is spent on theater tickets alone, another six hundred million on purchasing DVD's, while another three hundred million went to renting DVD movies. That's over thirty million DVD's purchased, by college students every year. Another expense that falls into the entertainment category is the money spent on alcohol. The average college student spends over fifty dollars a month on beer alone. Annually, liquor sales to college students are over five billion dollars. That's over a billion dollars more than what college students spend on personal care alone. Add another five billion a year for clothes and we have over 17 billion dollars being spent every year on entertainment, alcohol, and personal care alone. (A Look at the Spending Habits of College Students - StateUniversity.com; Gayla Martindale)
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Where Does All the Money Come From?
Along with the demographics and college student spending habits changing, so are some of the mind-sets of today's students. Many college students work part time jobs, or work during their summers, and receive money from their parents for tuition and spending. With college loans, grants and financing becoming easier to receive, and more plentiful, this adds to the total dollars of non-discretionary funding for college students. Another thought process is that more and more college students are going part time and taking five to seven years to complete their education instead of the traditional 4 years.
Although some college students have credit cards this trend has changed recently due to changes in the requirements to obtain a credit card. A new law states that in order to obtain a credit card an adult must be 21 or older. If not over 21, a co-signer is required. Credit card companies are also running tests to ensure the ability of students to pay back the balances of credit cards. This can change the credit status of this demographic significantly. This may also have an impact on the spending habits statistics in the coming years.
There is no question how large the college student portion of the economy is. College students represent over sixty billion dollars of spending capitol every year. (College Student Spending Behavior; O'donnel and Associates LLC.)