Younger generations are less reliant on credit cards than previous generations. Additionally, both Gen Xers and Baby Boomers are more cash-strapped and debt-dependent than Millennials.
Lending Tree recently conducted a survey among a nationally representative sample of 3,170 Americans to gain insight into credit card behaviors, sentiments and trends.
Of the 957 Millennials (b. 1980-1997) surveyed, only 61.34 percent said they own at least one credit card, representing the generation segment with the lowest credit card ownership rate. Following Millennials, 79.24 percent of the 785 Gen Xers (b. 1965-1979) surveyed stated that they owned at least one credit card, and 88.70 percent of the 1,150 Baby Boomers owned at least one credit card. The Silent Generation (b. 1925-1945) had the highest credit card ownership, with an astounding 96.55 percent (of 232 surveyed) owning at least one credit card.
When respondents were asked for their sentiments related to owning a credit card, Millennials were the least likely to feel they were needed. Only 28.84 percent said credit cards were “pretty much required today,” and over one-fourth (25.29 percent) of Millennials believed they “Don’t need one. Don’t spend what you don’t have.”
Not only do Millennials feel they do not need credit cards, but among those that still use cards, they were better at paying off their balance in full each month when compared to both Gen Xers and Baby Boomers. Roughly 54 percent of Millennials paid their balance in full each month while Baby Boomers were close behind, with 52.65 percent paying off their complete balance each bill cycle.
The generation that was the worst at paying off their credit card balances each month was Gen X. Only 42.12 percent paid their balance in full each month. Additionally, Gen Xers have the highest percentage of respondents stating they only pay off the minimum balance each month, with 11.58 percent paying the minimum and revolving the rest.
While the Silent Generation were the most likely to both have a credit card and state they were pretty much required today, they were also the most responsible in paying their debts with 71.88 percent paying credit card balances in full each month.
For Gen Xers, the data does suggest the generation was negatively impacted by the economic bubble, perhaps more so than even Millennials. Members of Generation X still have plenty of time and working years to get back on track and improve their spending habits. Resources such as debt consolidation loans can help lower monthly payments or lower total interest payments. LendingTree recommends comparing offers from lenders and credit providers as well as researching ratings and reviews to find a trusted financial partner.eCatalyst code version: H.20.3.
For data, background and forecasts on Lending Tree: Search CardWeb.com’s CardFlash® Library of more than 58,000 archived articles; Access CardWeb.com’s CardData® for current and historical Performance, Portfolios, Profiles, etc. Visit RAM Research® (ramresearch.com) for quarterly and annual forecasts covering more than 150 metrics. [complimentary or deeply discounted access to CardWeb.com subscribers].
Additional database resources include CardWeb.com’s CardExecs® – comings & goings of payments movers & shakers; CardWeb.com’s CardWatch® – ears & eyes on marketing globally (57K items); and CardWeb.com’s CardPixes® – form & function of card design (7K items).