A new survey finds 68% of people surveyed made at least one major Credit Fumble before turning 30: either overspending on credit cards, missing payments, having an account sent to collections, or defaulting on a loan.
Credit Karma announced the results of its research into the “Credit Fumble” phenomenon, a behavioral cycle where young consumers, many without the necessary financial education, fall victim to largely avoidable financial mistakes.
Drawing upon a survey of 1,051 Americans between the age of 31-44 and data from Credit Karma’s more than 45 million members, the company found:
• Three out of four of respondents felt like the financial mistakes they made before they turned 30 had a negative impact on the quality of their life.
• Only 28 percent of people surveyed received some type of personal finance education before college, with the majority of that education (58 percent) coming from parents.
• More than two-thirds of people surveyed (69 percent) did not properly understand what credit scores were when they got their first credit card; 73 percent said that better financial education could have prevented them from making credit-related mistakes.
• These Credit Fumbles make it hard for people to improve their financial situation as an adult: 61 percent of people surveyed were turned down for a credit card after making a Credit Fumble; more than a quarter (26 percent) had to move back in with their parents to recover financially.
Since 2014, Credit Karma has worked with college and university students across the country to educate young Americans before their first touch point with credit, through its Campus Challenge and Student Ambassador program. Alongside free credit scores and reports, it offers its members friendly, personalized information to help each of them understand and make the most of their individual situation.
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