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May 15 - Young Americans have fallen seriously behind on their credit card payments.


 
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 1 week ago '04        #1
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Exs 441 heat pts441
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May 15 - Young Americans have fallen seriously behind on their credit card payments.
 

 
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The U.S. credit card industry might be in a battle on two fronts.

A few notable trends.

18-29-year-olds traditionally outpaced other segments for delinquency entering the critical 90 delinquency segment.

All segments clustered as the U.S. came out of the financial crisis. There was a period, coming out of recession between Q12010 and Q1 2012 where the numbers fell in unison.

Coming out of 2012, millennial delinquency began to surge again. Today, through Q12019, 90+ delinquency for the 18-29 segment is at 8.05%, up from 6.11% in Q12012.

The millennial parent, which fall into the 50-59 age bracket is a little more than half their children’s delinquency at 5.58% for the current period improving over the Q12012 metric at 5.75%.

When you study credit card delinquency, the reason for delinquency is more often in the ability to pay, rather than in the intent not to pay. People get sloppy. Their debt is often too much to handle. Or, they face a household crisis like a divorce, employment issues, or medical problems. Even the most critical curmudgeon in the Group Credit Office will project that the number of people with bad intent and a desire to scam the credit business by refusing to pay is minimal.

But the words of Ronald Regan, trust and verify still hold true. In this case, I’d opt for FICO Scores as a foundational component of credit management, from acquisition to payout. Alternative bureau data is not the answer and is unproven during various business cycles.

There are a few important takeaways here for millennials.

First, the 18-29 age group was affected by the CARD Act of 2019. Unlike their parents, who made it through college with student credit cards offered by Capital One, Citi and MBNA (now Bank of America), this age group felt the test of the Ability to Repay rule, and a requirement to show proof of income or parental approval. As a result, the segment fell by about 85%, notably affecting the sale of pizza and beer in many student markets.
With less credit to rely on, getting new loans and credit cards became a harder option. Now the ones that ran the gamut and became seriously delinquent, such as the 8.05% referenced above, will carry the weight of bad credit for another seven years, where many of millennials will be entering their thirties, a prime area to build households with spouses and partners. Mortgages and credit card loans will certainly be affected.
For credit card issuers, who face market saturation and tighter margins, there is a risk factor. Millennials are the next feeder group for cross-sells and account growth, but there are the debt burdens of student loan and fancy auto payments, as the New York Times recently mentioned.

Perhaps it is time to get ready for Generation Z, those born in the mid-1990s to early 2000s.

And, pity the millennial’s grandparents, the 70+-year-old cohort, who find themselves with a 4.49% 90 day+ delinquency rate!

visit this link https://www.bloomberg.com .. dit-card-alarm


Last edited by Exs; 05-15-2019 at 03:21 PM..
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136 comments for "May 15 - Young Americans have fallen seriously behind on their credit card payments."

 1 week ago '17        #2
dubsax 15 heat pts15
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but why?
they said the economy is booming.
+14   

 1 week ago '04        #3
Exs 441 heat pts441 OP
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 dubsax said
but why?
they said the economy is booming.
it's booming for the 50+ yr old crowd that designed this piece of sh*t back in the Reaganomics days. The sh*t is broken but angering the stepford wives and their stepford kids by pulling the rug from under them just leads to their suppliers getting bailed out (e.g. 2008 financial crisis).
+26   

 1 week ago '10        #4
Shhon 1277 heat pts1277
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America judges the economy on how well rich people are
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 1 week ago '04        #5
Exs 441 heat pts441 OP
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 Shhon said
America judges the economy on how well rich people are
That's the best way for it to save face. THink about how much emphasis is put on the vanity and pride of this country. The reality that you can see with your own two eyes by driving through any of America's 50 most populated cities is that the closer you get to the heart of the life/city the more decrepit the living conditions and the more heartbroken the people.

The further out you get the less life and the prettier the view.
+19   

 1 week ago '16        #6
postemupndunkit 6 heat pts
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man n*ggas been broke wtf they expect

imagine being in your 20s living in NYC, the bay area, seattle, LA, etc.... you gotta feel for these young bloods man
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 1 week ago '04        #7
Exs 441 heat pts441 OP
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visa- you need one to go anywhere
american express- fast track to the american life
discover- money will facilitate new experiences
mastercard- this is all you really need to do anything

These are layman breakdowns of how credit card companies use propaganda to control you
+16   

 1 week ago '05        #8
pnoi89 18 heat pts18
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 postemupndunkit said
man n*ggas been broke wtf they expect

imagine being in your 20s living in NYC, the bay area, seattle, LA, etc.... you gotta feel for these young bloods man
More like financial illiteracy....
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 1 week ago '16        #9
postemupndunkit 6 heat pts
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 pnoi89 said
More like financial illiteracy....
you can say that until you are blue in the face but all these are the ills of a broken system fam

at a certain point something has got to give
+18   

 1 week ago '04        #10
Exs 441 heat pts441 OP
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 pnoi89 said
More like financial illiteracy....
spoken like a true product of a suburban family.

i got 12K free money right now.

if i ask you what to do with it you're gonna tell me to put it back in the system I feel is the root of the issue.

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 1 week ago '18        #11
DUCEDUCE 11 heat pts11
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 postemupndunkit said
man n*ggas been broke wtf they expect

imagine being in your 20s living in NYC, the bay area, seattle, LA, etc.... you gotta feel for these young bloods man
I feel you I was 18 working at subway and had money for an apartment with a pool. People are graduating from USC and are sharing a bedroom what the fu*k happened.
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 1 week ago '05        #12
pnoi89 18 heat pts18
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 Exs said
spoken like a true product of a suburban family.

i got 12K free money right now.

if i ask you what to do with it you're gonna tell me to put it back in the system I feel is the root of the issue.

Lol suburban. My family came from the poor in the Philippines and struggled when they emigrated to the states. I'm the LAST person to be implied that I'm privileged
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 1 week ago '16        #13
postemupndunkit 6 heat pts
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 DUCEDUCE said
I feel you I was 18 working at subway and had money for an apartment with a pool. People are graduating from USC and are sharing a bedroom what the fu*k happened.
living in their cars and working at facebook

man this sh*t is fu*ked

when the cost to exist is so high, obviously im gonna have to pay high priority things first

visa isnt coming before food, rent, transportation, cell phone so they gotta wait
+6   

 1 week ago '15        #14
The South 17 heat pts17
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These credit card offers in the mail every damn day.

Checks too tho.
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 1 week ago '04        #15
Exs 441 heat pts441 OP
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 pnoi89 said
Lol suburban. My family came from the poor in the Philippines and struggled when they emigrated to the states. I'm the LAST person to be implied that I'm privileged
1:1 odds you're a suburban product.

No foreigner who sees what's happening in this country would be blind to the reality unless they were a part of the problem.
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 1 week ago '18        #16
DUCEDUCE 11 heat pts11
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 postemupndunkit said
living in their cars and working at facebook

man this sh*t is fu*ked

when the cost to exist is so high, obviously im gonna have to pay high priority things first

visa isnt coming before food, rent, transportation, cell phone so they gotta wait
Honestly I steady see my money being worth less and less. I used to live off of $ 100 on groceries now its like 150 and 100 at costco.
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 1 week ago '16        #17
Birdmans Hands 4 heat pts
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doesn't affect me I'm not a bum. guess you n*ggas should have stayed in school
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 1 week ago '04        #18
Exs 441 heat pts441 OP
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 Birdmans Hands said
doesn't affect me I'm not a bum. guess you n*ggas should have stayed in school
def a bum
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 1 week ago '18        #19
BXLeaks 2 heat pts
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 Birdmans Hands said
doesn't affect me I'm not a bum. guess you n*ggas should have stayed in school
 Exs said
def a bum
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 1 week ago '05        #20
pnoi89 18 heat pts18
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 Exs said
1:1 odds you're a suburban product.

No foreigner who sees what's happening in this country would be blind to the reality unless they were a part of the problem.
That's just showing your ignorance.... I'm not a foreigner, btw. I'm US born.

I've always been pro-credit, which is obviously against the grain. Credit cards, when used appropriately, can only BENEFIT the credit card user.... I don't pity the majority of those in credit card debt due to financial illiteracy.
+11   

 1 week ago '19        #21
Gold Face 2 heat pts
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 dubsax said
but why?
they said the economy is booming.
 Exs said
it's booming for the 50+ yr old crowd that designed this piece of sh*t back in the Reaganomics days. The sh*t is broken but angering the stepford wives and their stepford kids by pulling the rug from under them just leads to their suppliers getting bailed out (e.g. 2008 financial crisis).
Economy doing well has nothing to do with people being financially responsible. I have 7 credit cards and only use one for gas.
-2   

 1 week ago '05        #22
pnoi89 18 heat pts18
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 The South said
These credit card offers in the mail every damn day.

Checks too tho.
When it's a great signup bonus, it's EASY money. I typically signup for nearly 5 credit cards a year, unless I'm shooting for the Chase credit cards (due to the 5/24 Chase rule)
-2   

 1 week ago '16        #23
00010111 124 heat pts124
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 Exs said
1:1 odds you're a suburban product.

No foreigner who sees what's happening in this country would be blind to the reality unless they were a part of the problem.
They're often the worst and the most judgemental.

At least the ones who run from third world countries are. In their minds there is no excuse for anybody in America to be struggling.
+13   

 1 week ago '18        #24
antisocial100 1 heat pts
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Great article , especially the part bout what’s gonna happen when all these young ppl who because these bad situations in their younger years have bad scores. How will they get mortgages and buy cars ... definitely will effect the future markets but I think the banks will turn a blind eye
+4   

 1 week ago '05        #25
pnoi89 18 heat pts18
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 00010111 said
They're often the worst and the most judgemental.

At least the ones who run from third world countries are. In their minds there is no excuse for anybody in America to be struggling.
Yup. You got it. Granted, I'm born here in the US, though raised a handful of years in the PI.
-1   

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