Two recent surveys have found conflicting data regarding millennials. Bankrate says
64% of millennials do not own a credit card, while FICO consumer research shows that 83% of Millennials fully use credit cards to fund their lifestyle.
The Bankrate study shows that credit card usage increases with age, wherein 55% of 30-49 year olds have credit cards, 62% of people age 50-64 use them and 68% of those ages 65+ affirm they own a credit card.
Overall, the poor and less educated are the least likely to own credit cards. About 72% of people who make less than $30,000 per year do not own a credit card, compared to only 18% of those who are card-less and make over $75,000. 63% of people with a high school degree or less do not use credit cards, compared to only 17% of college grads.
A person’s political affiliation also appears to influence their credit card usage. More Republicans own credit cards than Democrats, 71% vs 59%, respectively.
FICO’s latest consumer research on finance trends also found Millennials prefer new credit cards that offer: waived annual fees (85% of respondents); cash back rewards (75%); and lowest interest rates (73%).
About 31% of consumers 25-34 years old carry a balance of $1,000-$4,999 over each month, on their credit card. This was significantly more than all the other age groups with only 22 to 23 percent holding the same debt level. The 25-34 year olds also had more balances in the $5,000-$9,999 range but fell to second place when balances went over $10,000; the top spot went to the 35-49 year olds.
According to the Bankrate study, about half of Millennial respondents 25-34 have at least three cards, and 19% plan on using them to buy big ticket items such as a new car. 37% of this group also said they were ‘very likely’ to apply for a new credit card over the next six months. This was nearly double the number of young Millennials (21%) or middle aged respondents (20%).
With 49% of Millennials holding between three and five credit cards, lenders are competing for share of wallet.
Millennials are focused on no annual fee (75%), low interest rate (71%) and cash back rewards (71%).
By comparison, younger Millennials (aged 18-24) are even more focused on price, with 80% stating they are after no annual fee and 79% looking for low interest rates.
The survey also showed that Millennials want credit cards that offer account notifications (56%) and enhanced security (53%). A poor mobile banking experience is also likely to see them switch banks more than other groups.
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