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Studies

Credit Card Debt Likely to Increase Among Young Americans

David Andrew 3/1/16

Credit card debt is becoming an increasingly large problem for young Americans. According to a recent study out of Ohio State, the current generation of youths is taking on more debt and taking longer to pay it off than past generations.

This study looked at the financial situation of Americans born between 1980 and 1984 and compared their credit card debt to past generations. The situation looks pretty dire for the current group.

Young Americans today have accumulated about $5,500 more credit card debt than their parents’ generation did at the same age. Compared to their grandparent’s generation, young Americans have accumulated about $8,000 more in credit card debt.

“Young Americans have accumulated about $5,500

more credit card debt than their parents’ generation.”

The professors handling the study thought the youths were taking on more debt because of a desire to build credit history as soon as possible.

While this logic makes sense, it often backfires. Many young Americans can’t handle the financial responsibility of a credit card and get into financial trouble.

While a credit card can build credit, it’s not the only option. The researchers suggested  young Americans consider building credit just by regularly paying off their bills and save the credit card for later on.

Considering this viewpoint and the increased availability of credit cards, the researchers believe this trend will continue and future generations will get even more in credit card debt.

Source: Ohio State University. Photo source: nature.com.

About David Andrew
David Andrew is a former New York Life financial adviser, holding Series 6 and Certified Financial Planner credentials from his years with the company. He also holds degrees in economics and finance from McGill University. David is now a well-published finance writer with special expertise in credit cards and auto insurance. In addition to his work on BadCredit.org, his articles have been featured on eHow, Zacks.com, TheNest.com, Chron.com and other popular sites. When he's not keeping up with the latest news in the world of finance, David enjoys playing tennis and golf.
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