Before we discuss the two generations, let’s go over some facts on credit scores. The average credit score today in America is 716. This is a new all-time for FICO scores in the United States. This may surprise you since we are coming off a major pandemic and now with higher inflation rates. In fact, we are 5 points higher than the 2020 national average for all generations. Let us look at the close comparisons of the two generations.
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Experian State of Credit Report: Gen Y |
Experian State of Credit Report: Gen Z |
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AverageVantage Score 658 |
Average VantageScore 654 |
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Average Credit Card Balance 2.66 |
Average Credit Card Balance $2197 |
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Average Credit Card Balance $4651 |
Average Revolving Utilization Rate 30% |
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Average Revolving Utilization Rate 30% |
Average Number of Retail Card Balance 1.64 |
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Average Number of Retail Credit Cards 2.1 |
Average Retail Credit Card Balance $1124 |
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Average Retail Credit Card Balance $1871 |
Average 30-59 Days Past Due Delinquency Rate 1.6% |
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Average Non- Mortage Debt $27251 |
Average 60-89 Days Past Due Delinquency Rate 1.0% |
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Average Mortage Debt $232372 |
Average 90-180 Days Past Due Delinquency Rate 2.5% |
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Average 30-59 Days Past Due Delinquency Rate 2.7% |
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Average 60-89 Days Past Due Delinquency Rate 1.5% |
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Average 90-180 Days Past Due Delinquency Rate 4.4% |
The fact of the matter is that the two generations are fairly close. We believe that it is an unfair comparison due to the vast majority of gen-z is under the age of 18 and has not established credit as of yet. Today they only represent 20% of the population, and Generation Y, or Millenials as we call them, represent 21%.
In time the data will tell us both generations’ ages over the course of the next 5 to 7 years. We know that by educating and allowing these two generations real-life usage of credit as the best teacher. Many parents assist their teenage daughters or son by making them authorized users of credit cards. This is a GREAT idea and should be used more frequently.
Building a good credit score is vitally important; however, teaching a person how to maintain and not overextend themselves or their finances in high school, college, and immediately after that graduation and entering the workforce is imperative!
Both generations are winners. Today, you can spend your entire paycheck in less than 2 to 5 minutes with a click, pay, and purchase. This was not the case with a vast majority of Gen-X and certainly not Baby Boomers. There was no internet, email or no, online shopping, or paying bills. You deposited or cashed your check and wrote checks for your expenses.
The element of time was the basic order of the day.
Today, it takes discipline that one must have and a certain level of self-control when it comes to handling money. This typically impacts how well you do with paying your bills. To Gen-Z and Millenials, keep up the good work! Credit is a lifelong journey.
