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Millennials Rejecting Many Kinds of CreditAs the economy continues to recover from the effects brought on by the recent recession and more consumers are starting to feel better about their personal financial situations, many may be once again willing to start using credit and taking on larger balances. However, this seems not to be true of young people in particular.

A number of recent studies have highlighted that even as most older workers continue to bring back the debt-related habits they may have had prior to the recession — in one form or another — people under the age of 35 seem to be largely avoiding doing so, according to a report from the Chicago Tribune. For example, a Ipsos Public Affairs study conducted in conjunction with Sallie Mae found that among college students between 18 and 24 years old, only 39 percent had their own credit card last year. That’s down from nearly half just two years prior. Further, data from the Federal Reserve Board shows that those who do have cards now carry far lower balances; the median credit card debt for those under 35 shrank to $1,700 by the end of 2010, down from $2,500 nine years earlier.

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Free Credit Check & MonitoringThere may be reasons for these declines outside a greater caution about borrowing in general, the report said. For instance, most lenders have increased restrictions on credit of all types in the last several years, though many have since slackened them for all but mortgages more recently. Still, the lack of a credit history can be a troubling factor. Further, new rules related to keeping those under the age of 21 from obtaining credit cards in their own name may be restrictive as well.

However, many young people may also simply prefer to avoid credit, and pay only using cash they have currently, the report said. It seems debit card use has exploded among younger demographics in recent years.

“That demographic is much more debit card based,” Jeff Golding, president and co-founder of debit service WilliamPaid, told the newspaper. “I think they have the challenge of getting credit. As we all know, you don’t get credit without having credit.”

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Young people may also be avoiding debt because they don’t want to slip into the financial pitfalls their parents likely faced during the recession, including an over-reliance on debt that creates too delicate a balance in their everyday finances.

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