2 in 3 Millennials Have Credit Card Debt, More Than Double the Number Who Have Student Loans
Credit card debt weighs down more millennials' finances than student loans, according to a newreportfrom financial services online marketplace, CompareCards.com, which found only 13 percent of millennial credit cardholders are completely debt-free.
Across all generations, nearly one in four cardholders expect to die in debt, including those in wealthier households.
CompareCards surveyed more than 1,000 cardholders about their debts, from credit cards and auto loans to mortgages and student loans. Cardholders revealed their wide-ranging battles with debt, and many indicated they aren't optimistic about their abilityto pay it off.
Key findings
- Just 13% of millennial credit cardholders are debt-free,slightly higher than the 11% of Gen Xers who said the same, but far less than the 29% of baby boomers without any debt.
- 67% of millennials report having credit card debt, while just 36% face student loan debt.
- 25% of women think they'll never be debt-free, compared to 19% of men.
- 16% of those who expect to die in debt have a household income surpassing$100,000.
- Only 7% of cardholders with kids under 18 are debt-free,compared to more than 20% of those with older children or no kids at all.
- 7 in 10 of those in credit card debt across all age groups have at least one other type of debt as well.
- On average, millennials with debt expect to be debt-free at age 49, and they took on their oldest existing debt at 24.
- Gen Xers who owe expect to be debt-free at age 67, and they took on their oldest existing debt at 30.
- Baby boomers with debt expect to be debt-free at age 81, and they took on their oldest existing debt at age 49.
"Most conversations around millennials and debt center around the nation's trillion-dollar student loan crisis, but the truth is, credit card debt is far more prevalent. With many millennials juggling student loan or car payments on top of credit cardbills, it's no wonder some think they'll never be debt-free," saidMatt Schulz, CompareCards Chief Industry Analyst.
“Across all generations, it's shocking that nearly a quarter expect to die in debt. Viewing debt as a financial death sentence only makes matters worse, and those in debt should commit to action wherever and whenever possible. An extra$10or$20towardmonthly debt payments can really make a difference in the long run, especially when coupled with reduced spending or a side gig," Schulz said.
If you’re drowning in credit card debt, talk to your local credit union. InTouch Credit Union may be able to help you consolidate that high-interest credit card debt into a low-interest personal loan.
FAQs
Average Millennial debt by type
| Type of debt | Average amount |
|---|
| Mortgage | $295,689 |
| Credit card | $6,274 |
| Total non-mortgage* | $29,702 |
Jan 23, 2024
The two types of debt that are common in millennials is credit card debt and loan debt. This can be compare to baby boomers and generation x because about 60% of millennials in debt are student loans, while about 43% of debt are Gen Xers and roughly 18% of debt are baby boomers.
What demographic has the most credit card debt? ›
Baby boomers and Generation X had the highest credit card balances of over $7,500 in 2022. Millennials take second place with around $6,500 in credit card debt. Cardholders 75 and over had the lowest debt, at just under $4,000. Among ethnicities, White, non-Hispanic populations had the highest credit card debt.
What is one possible explanation for why millennials have significantly less credit card debt than the other two generations? ›
In fact, 32.1% of millennials live with their parents, compared to 14% who live on their own, or, 31.6% who live with a spouse or partner. Once again, this may make it less likely for millennials to seek out debt to begin with, since they likely have fewer living expenses.
What percentage of Millennials use credit cards? ›
According to the credit bureau, 84 percent of 22- to 24-year-olds had a general-purpose credit card during the fourth quarter of 2023, compared with just 61 percent of 22- to 24-year-olds exactly a decade earlier.
Why are so many Millennials in debt? ›
King said millennials' purchasing preferences and the soaring cost of living has led many into "a vicious cycle of taking on more debt." Many were "forced" to rely on credit cards and loans to meet their needs, adding to their "crippling debt pile."
What generation has the worst debt? ›
By most measurements, Gen X is deeper in debt than other generations. Members of Gen X — born roughly from 1965 to 1980 — have the highest average debt stemming from student loans, credit cards and more.
Why do millennials struggle financially? ›
Key Takeaways. Millennials are confronting the distinct financial challenges they have, such as a post-recession job market, high student loan debt balances, a more expensive housing market, and growing credit card debt.
What is the average income for millennials? ›
We counted millennial Americans as anyone who was between the ages of 18 and 40 as of 2022. Based on these data points, we found that the average salary of a millennial is $1,376 per week, which equates to $71,566 per year.
What happens when a person can no longer afford to pay back their debt? ›
The creditor may transfer the debt to an in-house collection department or they may sell the debt to a third party debt collection agency. A debt collection agency may buy the debt for a fraction of its value (they may pay $2,000 for a $10,000 debt, for example), but they have the right to collect the debt in full.
But one generation carries the most, on average: Gen X. The average credit card balance for Gen Xers, defined at those between the ages of 43 and 58, rose to $9,123 in the third quarter of 2023, according to Experian's latest available data. That marks the highest average credit card balance of any generational cohort.
Why do rich people use Amex? ›
The allure lies in premium benefits, ranging from airport privileges to everyday perks like Walmart Plus memberships or Uber cash. The key is to position the Amex card as not just a financial tool but a lifestyle enabler. This resonates with individuals who seek added value in every transaction they make.
What's the average credit card debt for millennials? ›
Here's the average credit card debt broken down by generation: Generation Z: $1,963. Millennials: $4,322. Generation X: $7,155.
Who uses credit cards the most? ›
Canada was one of three countries worldwide in 2021, where credit card ownership among consumers 15 years and up was over 70 percent. This according to a major survey held once every three years in over 140 different countries.
Why do some people have so much credit card debt? ›
Spending more than you make.
Overspending is one of the fastest ways to build a debt load that doesn't match your income. Consider your purchases carefully and do your best to avoid impulse spending.
Is $5000 in credit card debt a lot? ›
$5,000 in credit card debt can be quite costly in the long run. That's especially the case if you only make minimum payments each month. However, you don't have to accept decades of credit card debt.
What is the average credit card debt for a 30 year old? ›
Average credit card debt by age group
| Generation | Average credit card debt |
|---|
| Baby boomers (58–76) | $6,245 |
| Generation X (42–57) | $8,134 |
| Millennials (26–41) | $5,649 |
| Generation Z (19–25) | $2,854 |
2 more rowsFeb 14, 2024
On an individual level, the overall average balance is around $6,501, per Experian's data. Other generations' credit card debt falls closer to that average or below. Here's the average amount of credit card debt Americans hold by age as of the third quarter of 2023, according to Experian.
What is the average credit card limit for a 25-year-old? ›
Average Credit Card Limit by Age and Credit Score
| Generation | Average Credit Card Limit | Average Credit Score |
|---|
| Generation Z (age 18-25) | $11,290 | 679 |
| Millennials (age 26-41) | $24,669 | 687 |
| Generation X (age 42-57) | $35,994 | 706 |
| Baby Boomers (ages 58-76) | $40,318 | 742 |
1 more rowMay 15, 2023
