Millennial Business Owners Use the Most Credit and... - Other News


ADVERTISING DISCLOSURE: is an independent, advertising-supported web site. receives compensation from most credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » News » Other » Millennial Business Owners Use the Most Credit and Have the Lowest Scores

Millennial Business Owners Use the Most Credit and Have the Lowest Scores

Millennial Business Owners Use the Most Credit and Have the Lowest Scores

A recent survey from Experian shows that among small business owners, folks in the millennial generation have the lowest overall consumer credit scores out of all the demographics studied. The youngest generation also has the lowest level of education and the highest levels of credit utilization.

The study looked at small business owners to find out how entrepreneurs are using credit. For the study, Millennials were defined as those ages 18 to 34, Generation X were those ages 35 to 49, Baby Boomers means people ages 50 to 67, and the Greatest Generation is made up of folks ages 68 and up.

Credit utilization is high, scores are low

Credit utilization, or the amount of credit used relative to the line of credit available, was highest among Millennials, with an average utilization rate of 54%. Generation X was right behind them, with a rate of 51%. Baby Boomers and the Greatest Generation came in third and fourth, respectively, with utilization rates of 41% and 32% each. However, the actual average balances owed show that older folks actually have more debt. For example, the Greatest Generation carries an average debt load of $10,445 while Millennials owe an average of $6,263.

This is likely due to the fact that older people tend to have higher credit limits than their younger counterparts; therefore, they can rack up more debt and still have lower utilization rates.

Millennials also have the lowest average credit scores, perhaps because they have shorter credit histories and lower credit limits. The average Millennial small business owner had a business credit score of 32. (While consumer credit scores range from 300-850, business scores are on a 1-100 scale.) Average scores crept up with each generation: 33 for Generation X, 37 for Baby Boomers, and 41 for the Greatest Generation.

Education, experience, and income factor in

Younger business owners also had the least education of all the demographics studied. Fifteen percent of them never graduated from high school, and 16% didn’t finish a bachelor’s degree. Twelve percent of Generation X entrepreneurs didn’t complete high school, and about 19% of Baby Boomers didn’t graduate from college.

The most popular industries for Millennials to enter were business services, cleaning and maintenance, general contractors, and beauty shops.

Only slightly more than 27% of Millennial business owners were making between $50,000 and $74,999 a year, something that may reflect their lesser experience as well as lower education levels. The average older person (members of the Greatest Generation) had been in business for a little more than nine years, while the average Millennial had been in business for just over five years.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Add to Favorites:

Related News:

How are Minority Owners Small Businesses Doing?
How are Minority Owners Small Businesses Doing?

Posted: March 28, 2016

Credit management is a challenging issue for minority small business owners, according to a new study by Experian. It looked at their overall financial health in the current economy, finding that they are slightly behind other business... Continue reading
Millions of People Now Have Free Access to Credit Scores
Millions of People Now Have Free Access to Credit Scores

Posted: October 29, 2015

It used to be that people could only get one free copy of their credit report each year, and they still had to pay to find out their actual credit score. But over the last two years, since FICO launched their Open Access program, it’s... Continue reading
TD Bank New Cash Credit Card
TD Bank New Cash Credit Card

Posted: January 29, 2016

TD bank has launched the TD Cash Visa Signature Credit Card, offering 2% cash back when you eat out whether that's at Nobu, Starbucks, or MacDonald's. Continue reading
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
We'll match all the Miles you've earned at the end of your first year. For example, if you earn 30,000 Miles, you get 60,000 Miles.
For Excellent, Good Credit
Earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants,, or wholesale clubs up to the quarterly maximum each time you activate.
For Excellent, Good Credit
Our application is quick and easy with instant pre-qualification available
For Fair / Good Credit