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In this article:
- Millennials Have Second-Lowest Average FICO Score
- Credit Cards Are the Most Popular Type of Debt Among Millennial Respondents
- Most Millennials Surveyed Did Not Have a Rewards Credit Card
- Most Millennials Reported Using a Credit Card to Build Their Credit
- More Than Three-Quarters of Millennials Surveyed Aren’t Considering Taking New Debt
- Learn More About Millennial Debt and Credit
Millennials—consumers ages 23 to 38—are the new up-and-coming spenders whose debt is growing across every major debt product.
While we know the average amount they owe across all products is increasing throughout the U.S., little is known about what types of debt are most popular among the millennial generation and what types they may want to add in the near future.
As part of our ongoing look at debt and credit throughout the U.S., Experian surveyed a group of 345 millennial consumers to see what types of credit they have now and what new credit they're considering taking on. Read on for our insights and analysis.
To set the scene, millennials have an average FICO® Score of 668, the second-lowest score behind only Generation Z, which has an average score of 667, according to Experian data from the second quarter (Q2) of 2019.
When it comes to debt, millennials across the country have the third-highest total debt, carrying an average of $78,396. And while both baby boomers and members of Generation X have more debt than millennials, balances among millennials are growing across each debt product, and show no signs of stopping any time soon.
Credit Cards Are the Most Popular Type of Debt Among Millennial Respondents
When asked what type of debt they currently have, 42% of millennials surveyed said they have credit card debt. A smaller share (31%) said they have student loan debt, 22% said they have auto debt and only 18% said they have personal loan debt.
Broken out by gender, a larger portion of millennial women surveyed reported having credit card debt than men. The same was true of millennial women for student loan debt, auto debt, mortgage debt and medical debt.
Most Millennials Surveyed Did Not Have a Rewards Credit Card
While more millennials reported having a credit card than any other debt product, 52% of those surveyed said that they did not have a rewards credit card. Rewards credit cards offer users the possibility of earning valuable reward points for each dollar they spend on certain purchases. These points can be used for travel, online purchases and various other things, depending on the card issuer and the rewards program.
Most Millennials Reported Using a Credit Card to Build Their Credit
With the majority of millennials surveyed not focused on using their credit cards to earn reward points, it's not surprising that 40% of respondents said they had a credit card to build their credit. Credit cards are one of the best ways to establish and build credit, especially for younger borrowers who may not be taking out other loans.
The rest of the millennials surveyed reported having a credit card so they could have extra money (30%), for rewards (26%) and to make large purchases (25%).
More Than Three-Quarters of Millennials Surveyed Aren't Considering Taking New Debt
Looking into the future, only 18% of millennials said they were considering taking on new debt—a surprising statistic for a generation whose debt across the U.S. is growing in nearly every loan category.
The majority (53%) of millennials surveyed reported only having one to two credit cards. And in Q2 2019, millennials carried an average of $4,889 in credit card debt, according to Experian data.
So while millennials self-admittedly don't have that many credit cards and their debt is less than the national average of $6,194, a large portion (82%) of participants in our survey still say they aren't considering taking on more debt.
Learn More About Millennial Debt and Credit
To read more Experian research on millennial debt and credit check out the following articles: