Powered by MOMENTUM MEDIA
subscribe to our newsletter

Younger Aussies struggling with debt

New research has found that Gen Y is holding an increasing amount of non-mortgage related debt.

The consumer study by comparison website RateCity.com.au reveals that Australians are now taking on debt earlier in life, with age 20 the new average age for young people to purchase their first credit card.

This compares with the average age for older generations – such as those aged 65 years and older – who applied for their first credit cards at age 34.

RateCity.com.au chief executive Alex Parsons said it’s a worrying trend, given that young Australians are struggling with higher levels of debt.

“Our research shows 42 percent of young people under the age of 24 have between $10,000 and $30,000 of personal debt, not including a mortgage,” Mr Parsons said.

Advertisement
Advertisement

“Australians aged 24 and under are also four times more likely to get a weekly cash advance from their credit card than were their parents’ generation,” he said.

More than half (56 per cent) of Gen Ys with a credit card have never had a $0 balance on their credit card in the last year, and 63 per cent are not aware what interest rate they are paying, the report found.

“It’s a real concern, given that the average credit card rate is close to 17 percent – that’s a lot of interest we’re talking about there,” Mr Parsons said.

The number of credit cards on issue is on the rise – with 117,000 incremental cards on the market compared to last year – growing to 15.5 million in May, according to data from the Australian Bureau of Statistics.

The RateCity research found 34 per cent of people under the age of 34 have applied for a credit card online in the last six months.

PROMOTED CONTENT


 

Younger Aussies struggling with debt
mortgagebusiness

Latest News

The cash rate for the last month of 2021 has been confirmed, as analysts continue to speculate on when it will move next. ...

The big four bank has revealed plans to purchase a personal finance management platform from AMP, with plans to integrate the tool into its ...

The federal Treasurer has expressed concerns at the housing market running hot, but he is not sure if APRA will take further lending interve...

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

Do you think APRA's bank buffer changes will see more borrowers use non-banks?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.