Millennials need guidance when it comes to building and maintaining healthy credit habits, TD Bank reported Tuesday.
This comes at a time when four out of five millennials believe society will eventually become cashless.
A TD Bank survey found that 23% of millennials do not have a credit card, and are the age group most likely to prefer cash while traveling.
Half of millennials reported using between 31% and 90% of their credit limit, well over the recommended utilization rate of 30% or less. Thirty-two percent put their credit health at risk by failing to fully pay off their cards each month.
A quarter of millennials did not know their credit score. TD Bank said this could handicap them when applying for credit cards or loans, getting approved for a mortgage, buying a car or making other major purchases.
“The data is a bit concerning — it shows that a significant knowledge gap exists for millennials when it comes to credit, especially compared to prior generations,” Mike Kinane, head of U.S. Bankcard at TD Bank, said in a statement.
“We’re relying less and less on cash, and while credit cards may not be a millennial’s payment method of choice, it’s still critical that they develop financial knowledge and habits to properly position themselves for sound credit health down the road.”
MARU/Matchbox conducted an online survey and interviews in March 2017 among 1,002 consumers, and followed with a second survey among 1,000 respondents in August 2018, using the Springboard America panel to speak with 1,000 consumers.