Millennials turn to credit cards to combat cost of living pressure

Consumer education website CreditSmart has looked into credit usage among millennials and seen increasing adoption among this cohort. 

CreditSmart notes that millennials are highly credit active, with 88% currently possessing a credit product, which includes credit cards and Buy Now Pay Later (BNPL) services.

However, this hasn’t always been the case and the trend is more recent. The new research shows that between August 2022 and April 2023, credit usage among millennials grew from 50% to 55% and BNPL usage surged from 28% to 37%.

What has caused the increase in credit cards among millennials? 

While CreditSmart reports that many Millennials are using credit cards and BNPL services to help manage the pressure of rising living costs, they’re also learning more about credit.  

CreditSmart’s data shows that millennials are becoming more informed and are starting to take a more proactive approach in monitoring their ‘credit health’ and personal finances.

Furthermore, the data shows there was a 15% increase in the number of millennials checking their credit report in the last year.

Interested in getting a credit card?

If you’re interested in getting a credit card to help with the cost of living crisis, it’s important that you understand the risks and how to use them smartly so you don’t end up paying more.

There are lots of different types of credit cards and the best card for your needs will depend on your personal situation. Here are some examples below.

Types of credit cards

Low fee credit card - A low fee credit card is a good option if you’re sure you’ll pay off the balance in time because it means you won’t have to worry about paying any large fees for the card.

Low rate credit card - If you’re not great with deadlines and can’t be sure that you’ll be able to pay off the balance in time, make sure you go for a low rate credit card so that you won’t be charged massive amounts of interest if you’re late on a payment.

Balance transfer card - If you’re already in debt, a balance transfer card is a great option because it allows you to pay off your debt while paying a lower interest rate. Find out more about how balance transfer cards work.