This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Millennials May Take Credit Card Debt To The Grave





If you are looking for happy news about the financial future of young adults, you might want to stop reading. Research released last month finds that those born in the early 1980s are charging more on their credit cards -- and spending longer paying their balances -- than any generation before.

Researchers from Ohio State University not only looked at the amount of credit card debt held by young adults, but also the rate at which they are paying off their balances. The findings paint a chilling picture of a generation that may be receiving credit card bills until the day they die.

Are young adults in financial hot water?

To come to their conclusions, researchers used a statistical model to determine how much credit card debt different demographic groups will have at the same stage of their lives.

According to the results, children born between 1980-1984 -- also known as Millennials -- are projected to owe $5,689 more in credit card debt than those born between 1950-1954, a generation many Millennial parents belong to. The debt of Millennials is projected to be $8,156 greater than those born between 1920-1924, a group meant to capture their grandparent's generation.

While the level of credit card debt is concerning enough alone, it is not the only red flag that appears regarding the financial future of young adults. According to the study's authors, the data also suggest Millennials may continue to charge purchases until they are 70 and may even die owing money on bank cards.

"Our projections are that the typical credit card holder among younger Americans who keeps a balance will die still in debt to credit card companies," said Lucia Dunn, an OSU economics professor and a co-author of the study, in a written statement.

Avoiding the credit card trap

Part of the problem of perpetual credit card debt seems to be linked to slow pay-offs among young adults. According to the OSU research, children born between 1980-1984 have payoff rates that are 24 percent lower than their parents and 77 percent lower than their grandparents.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,356.87 +288.00 1.69%
S&P 500 2,012.89 +40.15 2.04%
NASDAQ 4,644.3120 +96.4780 2.12%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs