Credit card usage among young adults is changing

The front of a credit card with the numbers showing

When Matt Schultz, a senior analyst at, was in college during the 1990s, he and his friends rarely moved about campus without receiving offers to sign up for a credit card for a free T-shirt or flying disc. He told ABC News that campus mailboxes were always jammed with credit card promotions [1].

"That was the case for many, many years," Schultz said. "It's not the case anymore, though, and that's a good thing. Those tactics led to a lot of college kids making uninformed decisions that led to a whole lot of credit card debt."

Young adults seem to be steering away from credit card use altogether. A survey conducted by Princeton Survey Research Associates International in conjunction with revealed 36 percent of people ages 18 to 29 years old have never owned a credit card [2]. The survey polled 1,000 consumers across the nation.

"One of the biggest takeaways is just how quickly things have changed in a big way," Schultz said.

He noted a large portion of millennials are passing on the opportunity to use a credit card because they are worried they might spend more money than their budget allows. A hostile job environment and debt from student loans are two other factors that seem to be keeping millennials on the credit sidelines.

Erin Duffy, a 27-year-old from Nebraska, is one of the growing number of millennials who has never had a credit card.

"I've been able to get along without it," Duffy told Bankrate [3]. "I've liked being able to pay for things as I go, not having to worry about missing a bill."

Duffy credited her parents as a contributing factor in her choice to avoid credit usage.

Is there a specific age consumers should get a credit card?
The Princeton survey asked what age a young adult should take out his or her first credit card. The median age was 21 and the average age was 22.

However, 47 percent of credit card toting respondents said they owned a credit card before they turned 21.

LaTisha Styles, producer of Young Finances TV, a Web series focusing on millennials and personal finance, believes it's a good idea to start using credit after graduating high school. She said college students can put cellphone bills on credit cards, which should be paid in full at the end of each month to build credit scores.

Styles said it's a good idea to practice strong money management habits "as early as possible."

Using a credit card isn't for everyone
While some people prefer to charge everything to a credit card, others are more comfortable using a debit card or heading to the bank or ATM for a cash withdrawal. Schultz said some people are even foregoing credit card use for prepaid cards because the Credit CARD Act asks consumers under 21 to either have proof of income or a co-signer to acquire a card. This shows why credit card usage is down among millennials.

Schultz added one of the key advantages to owning a credit card compared to a debit card is fraud protection.

"If your debit card is used fraudulently, real money goes missing from your checking account," Schultz said. "You'll likely get all that money back, but it can take a couple of days or even a week or more."

If fraudulent charges appear on a credit card, the bank typically waives the charge.

The report from Princeton Survey Research Associates International also stated consumers living in rural areas were less likely to own a credit card, though fewer retailers in rural areas could have prompted the results.

[1]. A Third of Millennials May Be Skipping Credit Cards

[2]. Poll: Right age to get a card? 22

[3]. More millennials say 'no' to credit cards

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