Unfortunately, there’s a negative trend occurring around financial health with each passing generation.
A study done by Experian in 2016 found that Gen Xers (those born in the early 60’s to late 70’s) hovered around a fair 650 credit score rating. Millennial’s, or generation Y (80’s and 90’s), had an average score of 634 (poor). And the up-and-coming Gen Zers (mid 90’s early 2000’s) were also averaging a dismal 631 credit score.
In the study, baby boomers and the silent generation had Vantage Scores of 700 and 730 respectively. So it seems the younger you are, the worse your score is. Why is that?
Well, there are various actions younger people do to either knowingly or unknowingly hurt their credit history, some beyond their control. Here’s a brief listing of issues that have contributed to poor credit scores to younger generations.
Shorter Credit History:
First off, stating the obvious, your length of time using credit plays a substantial role on how well you score. So it’s quite understandable that new cardholders have less history. Therefore, your credit score will reflect that fact.