There’s nothing wrong with having, and using, a credit card. Many people here in Seattle and, really, all across the country are reluctant to apply for one — and while their fears are far from misguided, if you respect the financial responsibility of having a credit card and make your payments on time, a credit card can be very beneficial. You can develop good credit, making it easier to obtain other loans.
But, many people misuse their cards, resulting in crippling debt. In fact, according to some new data, people over the age of 40 “have more overall debt and lower credit scores” today than in 2005. Younger generations have seen their parents excessively use their credit cards, and get punished for it — which is just one reason why a new report found that young people are reluctant to get credit cards.
The report looked at people aged 18 to 29; and in 2007, only 8 percent of this age group did not have a credit card. Last year, though, that figure jumped to 16 percent.
There are a couple of other reasons for this trend. With college graduates struggling to obtain work, they are likely staying away from credit cards for the time being, focusing on their job search and student loans. Another reason for the decline in credit cards amongst young people is that, in response to the U.S. recession, credit card companies were forced to improve their standards for approving credit card holders — meaning many young people may now be getting denied.
Credit card debt can be absolutely crippling; and in order to get out from under such debt, many people turn to bankruptcy. The debt can be discharged through bankruptcy, giving people a fresh financial start.
Source: WGGB, “Fewer Young People Getting Credit Cards,” June 18, 2013