Leading Credit Card Provider Urges Financial Prep
                        Before Heading Back to School

MCLEAN, Va., July 29 /PRNewswire-FirstCall/ -- It's almost time to go back to school, and whether America's students plan to stock up on textbooks or gel roller pens this fall, one thing is for certain: parents are not doing their homework when it comes to advising their kids about the upcoming shopping season. According to Capital One Financial Corporation's (NYSE: COF) third annual back-to-school survey, more than 70 percent of college students surveyed say their parents have not given them tips or advice about spending wisely while shopping for school supplies. The survey also found that 87 percent of college students and 90 percent of high school students rely on their parents for financial guidance. Parents should take advantage of back- to-school shopping as an ideal opportunity to engage young adults in the process of budgeting, saving and purchasing the supplies they will take back with them this fall.

"Since many students experience their first hands-on shopping experience as they transition from high school to college -- where school supplies demand significantly larger budgets and many college freshmen have more financial responsibilities like paying tuition or cell phone bills -- it is increasingly important to instill financial basics like budgeting and spending wisely as early as possible," said Diana Don, Director of Financial Education at Capital One.

Learning through Trial and Error?

According to Capital One's survey, 98 percent of college students and 90 percent of high school students say they have learned about money management through their own experiences with money. Additionally, 53 percent of collegians and 43 percent of high school students claim to have learned something about money management through talking with friends.

"Despite looking to their families for general money management advice, most young adults 'learn as they go' when it comes to handling personal finances," added Don. "Without ongoing parental guidance and check-ins about money matters, young adults are setting themselves up for missteps that can lead to bad financial habits."

Are Students Buying in?

Today's students value a paycheck, even those as young as 12 years old. Capital One's survey found more than 70 percent of middle school and high school students say they perform odd jobs to earn extra money. Additionally 72 percent of college students have a regular full or part-time job.

This year, students will drive their family's overall back-to-school budget by not only matching, but surpassing their parents' contribution (56 percent to 44 percent, respectively). Middle school and high school students plan to contribute $43.50, while college students plan to chip in $279.

"Earning their own income affords young people the opportunity to have tremendous spending power and the independence to make their own financial decisions," said Dara Duguay, Executive Director of the Jump$tart Coalition for Personal Financial Literacy, a non-profit group dedicated to raising financial literacy among young adults. "By supplementing their parents' back- to-school budget, students are demonstrating a vested interest in bridging the financial gap between the 'I needs' and 'I wants'."

2003 Shopping Habits and Top School Supply Picks

According to Capital One's survey, parents plan to spend $119, $159 and $413 on their middle school, high school and college-age students, respectively. Fifty-nine percent of collegians and 51 percent of parents plan to use cash to purchase back-to-school supplies, while 20 percent of both groups will use a credit card. Additionally, when asked to estimate how long it would take to pay off purchases made on credit card, the largest portion of parents and collegians said it would take less than one month.

Of those surveyed, 48 percent of college students and 31 percent of middle school students consider shopping with their parents quality time. High school students are more likely to classify back-to-school shopping with their parents as an "annual ritual" (30 percent).

The majority of middle school students (67 percent) say they want new clothes, followed by mechanical pencils (52 percent) and a backpack -- perhaps one with wheels (38 percent). Eighty-four percent of high school students select calculators as an important need this fall over new clothes (75 percent) and a cell phone (27 percent). Ninety-eight percent of collegians indicate a priority need for textbooks, over a computer (75 percent) and a PDA (15 percent).

Free Education Resources for Parents and Students

In an effort to help educate parents and students, Capital One offers easy-to-understand consumer education resources on topics such as budgeting and developing spending plans. All materials are available for free online at www.capitalone.com/credit101. For additional online resources, parents and students can visit www.jumpstart.org and search the "clearinghouse" for curriculum and education materials from the Jump$tart Coalition for Personal Financial Literacy.

Survey Methodology

Capital One's back-to-school study was conducted by ICR/International Communications Research of Media, PA. The survey was conducted among a random nationwide sample of 750 students (ages 12-23) and 250 heads of households where a student (ages 12-23) is present.

About Capital One

Headquartered in McLean, Virginia, Capital One Financial Corporation (http://www.capitalone.com/) is a holding company whose principal subsidiaries include: Capital One Bank and Capital One, F.S.B., which offer consumer lending products, and Capital One Auto Finance, Inc., which offers auto loan products. Capital One's subsidiaries collectively had 45.8 million managed accounts and $60.7 billion in managed loans outstanding as of June 30, 2003. Capital One, a Fortune 500 company, is one of the largest providers of MasterCard and Visa credit cards in the world. Capital One trades on the New York Stock Exchange under the symbol "COF" and is included in the S&P 500 index.

SOURCE Capital One Financial Corporation

CONTACT: Diana Don of Capital One Financial Corporation, +1-703-720-2371, or diana.don@capitalone.com; or Jennifer Butler of MS&L, +1-212-213-7061, or jennifer.butler@mslpr.com