An increasingly shocking number of young people are growing up having no credit cards. Reasons for this vary, and the recession is only one of these reasons. Research from the Fair Isaac Corporation (people behind FICO credit score), Americans aged between 18-29 years who owned no credit cards in the fall of 2012 amounted to 16% and in the same period of 2009, it had amounted to 12%.
In order to avoid the too many credit cards signed up for by freshman college students in order to get free Frisbees and t-shirts, the federal CARD Act raised the minimum age of signing up for a credit card to 21. The resulting increase of Americans aged 18-29 not owning credit cards has to do with this increase in minimum age. However, it does not tell the whole story. There are further reasons.
If we look at the graph above, it appears that all age groups of people are discarding credit cards. For some, the card-free lifestyle might be due to the recession which wrecked their credit rating. For most young people, debit cards simply became a trend, seeing they were easy and accepted everywhere, and not involving massive debt.
However, young people should be aware about not using credit cards. There is a problem attached to this because when young people would then go to buy a house or a car later on in life, they would not have a history of credit would result in their being granted a less favourable loan or at certain times, not being granted a loan at all.
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