It might be easy to assume that cash and debit cards are king with Millennials, but not so fast. They love their credit cards too, according to a new study by FICO, which found that 83% of 25 to 34 years old use their credit cards to keep their lifestyle going and 77% will keep on this course over the next five years.
What makes a credit card attractive to Millennials? Everything from no annual fees (85%) and cash back rewards (75%) to reduced interest rates (73%).
“Millennials are very interested in obtaining and using credit cards as they remain a convenient mode of payment and source of credit. They are still maximizing their earning potential but also juggling numerous lifestyle costs, such as college loans, car and home ownership, as well as supporting young families, ” said Joshua Schnoll, senior director for FICO.
Millennials are not debt adverse
The FICO study found that Millennials are not as debt averse as some suggest, with 31% carrying a balance in the $1,000 to $4,999 range, which is much more than other generations.
How many credit cards do the younger generation have in their wallets? Just about half have three or more cards, and 19% are planning on using theirs to finance big purchases like a new car.
Security, security, security
Security is important to Millennials, wanting cards that watch their back and their bank accounts wiith 56% wanting account notifications and 53% looking for enhanced security. What if they have a bad mobile banking experience? This is enough to send them to a new bank, much more so than other generations.
When it comes to managing credit cards the younger set is more interested in using “self-managing” payment card controls than their older counterparts, with 47% looking to be able to turn their cards on and off, and 45% wanting to be able to control the kinds of purchases made with their cards.
34 year olds are only making their minimum monthly payments every month.