Will fewer credit cards lower risk of bankruptcy for young people?
Recently released data shows that younger people are being more mindful of their money and more wary of consumer debt. At the end of 2012, 16 percent of people aged 18 to 29 did not have a credit card in their wallet. A survey in 2007 showed that only eight percent of people in this age range did not have at least one credit card, indicating a reluctance towards consumer debt for the younger generation.
Experts have commented on the data, surmising that young people got rid of their credit cards during and after the recession as a result of seeing so many people suffer from overwhelming debt. People in this age bracket also have less credit card debt overall, meaning that those who do have credit cards may be using them more sparingly that older generations.
In fact, credit card debt is down by about 30 percent in the 18-29 year-old age group and credit scores have gotten higher as well.
In light of these trends, the more cautious approach to consumer debt may help young people stay out of financial hot water in the future. Credit card debt is easy to rack up and it often has a very high monthly interest rate, which makes it harder to pay back in full once a balance is overdue.
For those who do find themselves in trouble with mounting debt that they cannot pay, Chapter 13 bankruptcy is an option to restructure debt and to help get a fresh start.