For years, millennials have been the topic of conversation along with their financial struggles. Some experts would blame their poor choices, while others would feel compassion that they were dealt a bad hand. Whether the cause of the problem is external or internal, millennials can’t help but find ways to cope with these money problems.
According to Wink Capital, millennials suffer from the most debt compared to other generations. Here are some of the interesting statistics about millennials and their debt status:
- Millennials ages 25-34 have an average of $ 42,000 in debt.
- The top two sources of debt are credit card balances, while the next is student loans.
- 1 in 4 millennials suffers from debt which amounts to $ 30,000 and above.
Despite these staggering numbers, millennials have found a way to ease their financial burdens, and one way is through finding better credit card offers. Credit card debt may be a challenge to pay off, but all is possible through the millennials’ new financial strategies. Below are some reasons why credit card companies should step up their game to get more millennials to sign up.
Wink Capital Shares Why Millennials Look For New Credit Cards More Than Older Generations
Credit cards can help millennials stretch their budget.
Many millennials understand the consequences of using credit cards–some of them have interest rates when you pay off the minimum amount. Credit card balances can eventually lead to skyrocketing costs when interest rates are added up.
However, a lot of these young adults also need to pay off other expenses. This is one of the major reasons why they use new credit cards. They can use their new credit to extend the timeline of their payments, while still having money for their daily expenses.
According to Wink Capital, credit card companies and banks can help millennials by offering lower or zero interest rates for credit card balances. Lowering interest rates can help credit card companies remain competitive in a financially tight market.
Millennials want credit cards with big rewards.
Though they often get blamed for their poor financial decision-making, millennials are now learning their lesson by being savvy about their credit card choices.
According to an article on CNBC, 68% of millennials want a credit card that offers big rewards. This includes freebies, discounts, travel packages, and other exciting offers. Since they are more selective compared to other generations due to their tight budget, they would only pick the best credit card offers with exquisite rewards.
The survey in CNBC showed that many of the millennials want a 3% cashback on their purchases, while others prefer a $ 500 or $ 1,000 sign up bonus. For jet setters, an ideal perk would be converting the rewards to free flights or miles on their chosen airlines.
This says a lot about the current credit card market. If credit card companies want to get the best of millennials, they should also be willing to present the best reward offers.
Millennials want to improve their credit score.
Another major reason why millennials are looking for new credit cards is to bump up their credit score. A lot of them may be rejected for housing, business, or other types of personal loans.
Having credit cards and paying the balances successfully helps increase their chance of acquiring these loans through a higher credit score. By offering easier payment schemes, credit card companies can successfully market their credit card through this demographic.
Credit card companies should understand these reasons and use them to their advantage to help millennials. This is a win-win situation for both parties, and when done right, can help millennials rise from debt