LGBT Americans are handling their credit wisely, an Experian survey finds. Overall, one-third say they use credit cards to improve their credit, and among those age 25 to 34 that rises to 50 percent.
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A survey by credit-reporting bureau Experian indicates 70 percent of U.S. LGBT consumers pull out their plastic mainly to purchase needed items rather than wanted (but unneeded) items.
Also, LGBT consumers are eager to earn rewards through their credit card spending, with 55 percent saying they use their cards to collect airline miles, hotel stays and cash back rewards.
“Overall, the survey reinforces that everyone can benefit from managing their credit wisely and taking steps to avoid racking up credit card debt, budgeting carefully for expenses and paying credit card bills on time,” says Sandra Bernardo, manager of consumer education at Experian.
Nearly one-third (32 percent) of the LGBT Americans surveyed said they use credit cards to improve or build their credit, but Bernardo says she was heartened to see that 50 percent of those surveyed in the 25-34 age group said they use their cards to beef up their credit.
Experian surveyed 500 Americans who identified as lesbian, gay bisexual, transgender or queer (LGBTQ) to learn more about their financial behavior and attitudes.
Other interesting tidbits from the survey:
- 18 percent reported not having any credit cards bearing their names. Among 25- to 35-year-olds, that share rose to 25 percent.
- 20 percent ranked paying off debt as their second biggest financial concern. It was preceded only by saving for retirement (29 percent).
See related: Guide to LGBT finances: You can live a richer life
David Rae, a certified financial planner in Los Angeles who caters to LGBT clients, notes that while the youngest group in the survey (25-34) put the most focus on paying off debt, the oldest group (65-plus) emphasized maintaining a surplus of cash after paying monthly bills.
“We are not all born fabulously wealthy,” says Rae, who is gay. “While many in the community do extremely well for themselves, a large number struggle for basic things like housing and food.”
Rae says that for many LGBT people, those struggles start early in life.
“We’ve seen large numbers of LGBTQ youth thrown out of their homes or become estranged from their families,” he says. “Situations such as these can increase the challenges of keeping your finances together in your earlier years. While they can also lead to problems later in life, they are more likely to be pronounced earlier in life.”