| We’re living life in the breach these days, as in the Home Depot credit card breach, the Target breach and the Neiman Marcus breach, etc. You may even have heard some old-fashioned thinking around the water cooler lately, stuff like, “The best thing may be to just pay cash.” Of course, this is usually followed by a bit of self-conscious laughter. I mean, everyone knows that’s impossible, right? Who carries cash these days? Well, Millennials do, apparently, and it eventually could screw up the entire economy. Or not. Think you have young people figured out? Let’s take a test. What percentage of Millennials, the roughly 18-29 age category, would you guess does not own a credit card? |
| | Bankrate.com recently commissioned a survey by Princeton Survey Research Associates International to answer that question. The answer they came up with was 63 percent. Bankrate.com quoted one 24-year-old New Jersey woman as saying, “The idea with a credit card is you’re essentially putting money down that you don’t have.” Which is subversive talk, right? Wasn’t it just a decade or so ago that our leaders were urging us to go shopping to show terrorists we’re not afraid of them? This, by the way, is the same group that is finding it hard to move out of mom and dad’s basement. A report from Trulia on market trends finds that 31.1 percent of them live with their parents, and many of those who move out just move in with other relatives. What’s the matter with kids today? Well … take a deep breath. The answer is, nothing. We tend to be schizophrenic in the wisdom we impart to the young. Not long ago, I was writing columns chastising young people for getting credit cards too soon. In 1999 I went after Visa and MasterCard for targeting colleges, tossing “money around like bread crumbs in the park.” In those days, kids were charging pizzas, for heaven’s sake. Didn’t they realize they would have to pay it all back some day? Now we hear the opposite. Pundits and experts are wringing their hands over the inability of young people to obtain credit cards, failing, as one columnist recently said, to act like grownups. Don’t they understand that you need credit to survive in the adult world? It’s slowly dawning on me that maybe older people, like myself, are just grumpy old frumps with false memories of our own youth. And get off my lawn! Here, in a nutshell, is the complaint: If you don’t have a credit card, you’re not building a credit history. That means when you want a mortgage or car loan, banks won’t lend you money. Ergo, you will fail to launch as an adult and become lazy, self-indulgent and not likely to amount to much. Which paints a perfect portrait of a generation viewed without any context, including the times in which they live. Many Millennials have dealt with a poor national economy since junior high. In order to obtain a college education, they had to acquire student debt. Then, when they graduated, few jobs were waiting, and the ones they found didn’t pay much. Is there any wonder these folks have been reluctant to borrow even more? Recent news from the automotive industry shows that Millennials finally are buying cars but, according to Automotive News, they tend to “value cost-effectiveness and convenience.” Which, if you step back a moment and examine it, along with everything else, means they are practical, prudent and frugal. They even, according to a recent Gallup poll, would like to get married, although few of them have so far. It’s as if we’ve just raised our grandparents, the ones who lived through the Great Depression. Maybe the real problem is with us older folks. Maybe, as Mike Sullivan of the debt counseling agency Take Charge America told Bankrate, credit bureaus should begin counting things like rent and utility payments when figuring credit ratings. Maybe all that talk around water coolers deserves more than laughter. We should take notes from a generation that, through necessity or otherwise, has learned lessons the rest of us should have taken to heart years ago. |
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