Love This: Young Millennials Don’t Use Credit Cards

Well, finally some good news…sort of. This is based on U.S. stats, but let’s hope some of it applies here in Canada.

Credit card issuers are very stressed out: Millennials, those around 18 to 35 really don’t want, and don’t use credit cards. Only one in three even have them, they use the sparingly, and don’t carry much of a credit card balance.

Since they’re over 65 million people, it’s going to impact the future profits of card issuers. But why such a drastic change from their parents? It’s actually easy to explain. The U.S. had a massive financial meltdown from 2008 to at least 2010. So the vast majority of millenials would have lived at home at that time. They saw a parent, or relatives lose their job. Millions were home when the sheriff knocked on the door with a foreclosure notice, or had to move when their parents turned in the keys. They saw entire neighbourhoods wiped out, vehicles get repossessed, and felt the tension, fights, and stress at home.

Just like the students from Stoneman Douglas school in Florida will never be the same again when it comes to their view on guns. For a generation that’s labeled as having literally an 8 second attention span, their focus on gun regulations will last a lot longer. In that same way, the kids who saw the financial meltdown first hand will remember that for a lifetime.

Sadly, we don’t learn the horrific lessons of others. These things generally have to hit us personally, before we take notice. That’s generally the most frustrating thing for parents to realize when teaching their kids, even giving their adult kids feedback and advice. People don’t move until they’ve been moved. But when we’ve had that near-death financial experience, we generally get really smart, really soon, and it tends to last.

That’s the big picture, and the positive. On the reality side, 41% of them are buried in student loan debt and their income isn’t close to what their parents made. However, card issuers don’t really have to worry: Sadly, after age 30, credit card balances, even for millennials double, according to FICO, the company that creates credit scores.

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