Millennials Want Credit. They Just Use It Way Differently Than Their Parents

by Brian Riley 0

 Great headline, though the problems in total indebtedness, not just credit cards.

Here’s a story that misses the mark in their explanation about millennials and credit cards. They are partially right, that Card ACT of 2009 cut millenials ability to get credit cards.

• Millennials own fewer credit cards than older generations, but that doesn’t mean they are credit averse.

• Adults between the ages of 21 and 34 also have a strong appetite for auto loans, opening them at a 21 percent higher rate than the previous generation.

• While millennials take out personal loans at a 98 percent higher rate than adults their parents’ age did, the study found Gen X consumers owned two more credit cards than millennials when they were the same age.

The best data for this question can be found in the Federal Reserve Bank’s household study, where you’ll see that personal loans fall into the “other” category, on page 3. That’s only 3% of total debt. It is true that auto loans are up, for all segments. The big burden millennials face is wrapping their arms around student loan debt which outpaces credit card debt by hundreds of millions.

Overview by Brian Riley, Director, Credit Advisory Service at Mercator Advisory Group

Read the full story here