WINCHESTER — Addressing nearly 300 seniors at George Rogers Clark High School on Tuesday, lawyer Carl Gibson asked how many of the soon-to-be-graduates had turned 18.
Several hands went up.
"You," Gibson informed the youngsters, "are now legally responsible for any debts that you may incur."
In other words, congratulations and welcome to the adult world of credit — and all the pitfalls that face those who abuse it.
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The presentation was part of the Kentucky Bar Foundation's Credit Abuse Resistance Education program, known as CARE. The effort, based on a national program started seven years ago by a U.S. bankruptcy judge, is intended to help prepare Kentucky's new high school graduates to deal wisely with credit and finance.
District Judge Earl-Ray Neal, who also spoke Tuesday, said many of the civil cases he sees involve credit-card debt.
"People are getting in over their heads; it's an epidemic," said Neal, who presides over district courts in Clark and Madison counties.
Students must understand that anytime they buy on credit, they ultimately will pay more than if they bought with cash.
Winchester lawyer William Elkins urged students to think of credit as a "cushion" to be used mainly in time of emergency need.
"Credit is a wonderful cushion," he said. "It should not be used for luxuries."
The Kentucky Bar Foundation adopted the CARE program in 2008 for Lexington and Louisville high schools. This year, the project is expanding to include Clark, Madison, Pulaski and Pike counties, and the plan is to reach even more counties next year, said Todd Horstmeyer, the bar foundation's executive director.
Gibson said many clients he represents are individuals and couples who get deeply into debt before they realize it. He described a couple with a combined monthly income of less than $2,000 who ran up $78,000 in credit-card debt simply by taking vacations each year.
Young people can be particularly vulnerable, Gibson said, citing an Indiana University study which found that 10 percent of students who dropped out of IU did so because of debt.
Gibson said the typical college graduate owes $20,000 in student loans, plus $3,000 in credit-card debt.
Neal said students must start preparing now to avoid such pitfalls. High school seniors can expect to be inundated with applications from credit-card companies when they arrive on college campuses this fall, he said.
"You need to think about what you're signing up for," Neal said. "The credit decisions you make now can have a dramatic effect on your life for years to come, the kind of car you'll be able to drive, whether you'll be able to get a nice home to live in."