Millennials Cutting Back on Credit Cards, But Struggle with Credit Scores

Millennials Cutting Back on Credit Cards, But Struggle with Credit Scores

February 5, 2014         Written By John H. Oldshue

Millennials are carrying far fewer credit cards with smaller balances than older consumers but are still struggling with their credit scores and debt utilization.

Experian’s Fourth Annual State of Credit analyzed the credit card habits of four generations: Millennials (19-29), Generation X (30-46), Baby Boomers (47-65) and the Greatest Generation (66+).

Millennials carry 40% less credit card debt than the average person. Consumers who are 19-29 years old have $2,682 in credit card debt compared to the national average of $4,501. In addition, Millennials have the fewest number of bank cards of the four generations: the average millennial has 1.57 bank cards versus a national average of 2.19. In fact, a greater number of younger people continue to shy away from carrying any cards. In 2005, the number of people between the ages of 18 and 30 who did not own a credit card was 9%. In 2012, that number rose to 16%.

One of the reasons for the drop in credit cards is that banks tightened their credit standards after the recession, making it harder for Millennials to qualify for a credit card.

While Millennials show a reluctance to charge and open new accounts, stores continue to launch campaigns aimed at this demographic. Macy’s recently released a full chain of brands that are designed for young adults, and Marshalls has opened a store-within-a-store targeting this group as well.

Despite carrying fewer cards and charging less, Millennials still struggle with their credit score. The average Vantage score of 628 is significantly lower than the national average of 681. The study found that credit scores increased rather substantially as people entered an older demographic.

Generation X has the most debt with an average amount of $30,039, almost 8% higher than the national average. They also have the highest rate of late payments. These figures explain their lower-than-average credit score of 653.

Baby Boomers have the most cards with an average of 2.66. But their average credit score (700) and debt utilization (30%) show they are in fairly good financial shape.

It is not surprising that seniors have the highest credit scores (735) with the lowest credit card balance, the least amount of debt, and pay off their bills on time better than any other generation.

As a country, the average credit score was 681, the average debt utilization was 30%, the average debt was $27,887, and the average person had 2.19 bank cards with an average balance of $4,501.

The information contained within this article was accurate as of February 5, 2014. For up-to-date
information on any of the terms, cards or offers mentioned above, visit the issuer's website.


About John H. Oldshue

John Oldshue is the creator of He worked for over 15 years in television and won an Emmy award for his reporting. He covers credit card rate issues for
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