Race, gender and age all play a role in how much credit we’re able to access and whether we’re able to use that credit to greatest advantage. CreditCards.com has compiled statistics on demographic trends in the credit world.
Minorities are less likely to have access to credit than white Americans.
- In 2018, 15% of whites did not have access to a credit card compared with 32% of African Americans and 28% of Latinos.1
- African Americans and Latinos are less confident that they will be approved for credit than whites. In 2018, 84% of whites were confident that they would be approved for a credit card, compared to 63% of African Americans and 72% of Latinos.
- While 12% of whites were not confident that they would be approved for credit, 27% of African Americans and 20% of Latinos were not confident.1
Confidence that a credit card application would be approved
|Race/ethnicity||Confident||Not confident||Don’t know|
Credit scores among racial and ethnic groups
One reason for the lack of credit confidence among minorities could be that minorities tend to have lower credit scores than white Americans.
- In 2017, an Urban Institute study found that predominantly nonwhite areas in 50 out of 60 cities studied had median credit scores that were 660 or lower, and most of the cities had median credit scores that were 600 or lower.
- In comparison, predominantly white areas in only four of the 60 cities studied had median credit scores that were below 660.2
- In some cases, higher credit scores may not even translate into money and credit confidence among minorities. In 2018, African Americans with credit scores of 700 or above were 80% more likely to say they live paycheck to paycheck than the general population of adults with prime credit scores.
African Americans with credit scores of 700 or above were also 50% more likely than the general population of prime credit score adults to say they have “too much debt right now,” according to a study by Elevate’s Center for the New Middle Class.3
Among African Americans with credit scores below 700, 51% said they always find themselves living paycheck to paycheck and they’re more likely than the general population of consumers with credit scores below 700 to use payday loans and paycheck advances rather than have bank loans and credit card balances.3
Minorities are also more likely to have insufficient credit histories to generate a credit score. A report released in 2015 by the Consumer Financial Protection Bureau looked at the number of Americans who were “credit invisible,” meaning they had no records with credit reporting agencies, and the percentage who were unscorable, meaning they had insufficient records to generate a credit score.
- According to the report, as of 2010, approximately 15% of African Americans and Latinos were deemed credit invisible, compared to 9% of whites and Asian Americans.
- In addition, 13% of African Americans and 12% of Latinos were unscorable, compared with 7% of whites.4
In 2018, 1 in 5 credit invisible Latinos had no financial footprint, as 24% had no bank accounts at all. Also, credit invisible Latinos were more likely to be unacculturated, meaning they had not adapted to American culture, than noncredit invisible Latinos. In fact, 23% of credit invisible Latinos were unacculturated compared to 20% of Latinos with credit scores below 700 and 12% of Latinos with credit scores 700 or above.5
Latinos are also more likely to be dissatisfied with their credit scores than other populations. In 2016, 37% of Latinos said they were dissatisfied with their credit scores, compared to 32% of Americans overall.6
In 2016, only 54% of Latinos said they had checked their credit scores in the last year, compared to 60% of the general population. Twenty% of Latinos had never checked their credit score, compared to 14% of the general population.6
The reasons Latinos gave in 2016 for not checking their credit scores in the past year were:
- They had no reason to (40%).
- They didn’t get around to it (35%).
- They were afraid it would be a low number (29%).6
In 2016, 72% of Latinos said they wanted to improve their credit score over the next year compared to 66% of the general population. Latino millennials were most driven to improve their credit scores, with 78% wanting to improve their scores over the next year.6
Universal wariness of debt
One thing most demographic groups have in common is the desire to minimize their debt load.
- In 2018, one-third of Latinos who have credit scores 700 or above said they believe credit cards can lead them into financial trouble. Half of Latinos with credit scores below 700 also feel this way.
- That may explain why in 2018 1 in 4 Latinos reported using a prepaid card on a regular basis.
- Also, 61% of Latinos with credit scores 700 and above have a general-purpose credit card, lower than the 70% of the general population with credit scores of 700 and above.
- Among consumers with credit scores below 700, just 41% of Latinos have a general-purpose credit card compared to 51% of the general population.5
In 2015, 50% of African Americans, compared with 49% of the general U.S. population, said reducing personal debt was an important financial priority. Forty-nine percent of African Americans said in 2015 that they had some credit card debt compared with 49% of the general population.7
African Americans are also less likely than other groups to change their favorite credit card. A 2019 CreditCards.com survey found 36% of African Americans had never changed the card they use most often, compared to 30% of whites and 30% of Latinos who said the same.8
Women boast higher credit scores
Women are winning the gender wars when it comes to credit scores.
- In 2018, women had higher credit scores than their male counterparts. The average VantageScore among women was 684 compared to 680 for men. Women also carried, on average, 3.13 credit cards compared to men who had approximately 2.98 credit cards.
- However, men were carrying more debt in 2018, reporting on average $6,752 in credit card debt compared to $6,452 for women.9
In 2016, women had 23.5% more open credit cards than men, yet both men and women had the same credit utilization ratio, of 29.9%.10
Credit card trust, loyalty rise with age
Senior citizens are the most likely group (aside from Gen-Zers, who range in age from 18-22) to stick with their favorite credit card.
- In 2019, 36% of seniors age 74 and older had never switched their preferred cards, compared to 26% of baby boomers, 29% of Gen-Xers and 31% of millennials.
- Forty-six% of Gen-Zers said they had never switched, but this group has had comparatively less time to stray from their most-used card.
- Not surprisingly, millennials were most likely to switch credit cards frequently, with 17% saying they had changed preferred cards in the past year.8
Generations also vary on their usage of credit cards, as well as their credit scores.
- Older consumers had the highest credit scores in 2018, with those 72 and over reporting an average VantageScore of 732. In comparison, consumers between the ages of 22 and 35 had an average Vantage credit score of 644 in 2018.
- Consumers between the ages of 51 and 71 tend to have the most credit cards, reporting an average of 3.48 credit cards in 2018.
- Consumers between the ages of 36 and 50 tend to have the highest credit card balances. In 2018, that age group had an average of $8,012 on credit cards .
- In comparison, those between the ages of 51 and 71 had an average credit card balance of $7,637 in 2018, those between 22 and 35 had an average credit card balance of $4,593 and those between 18 and 21 had an average credit card balance of $2,259.9
Not only are millennials not loyal to their credit card companies, but they haven’t been known to be bullish on credit in general. In the first quarter of 2019, millennials carried less credit card debt than average, reporting $4,172 in outstanding credit card balances compared to the national average of $6,028.11
However, that appeared to be changing, as millennials – those between 23 and 38 in 2019 – saw their average credit card debt increase by 7% in 2019 from the year before. On top of that, millennials appear to rack up debt with age. In Q1 2019, 23-year-old millennials had on average $2,288 in credit card debt while 38-year old millennials had on average $6,675 in credit card debt.11
Generation Z – those between 18 and 22 in 2019 – also saw their average credit card debt increase by 11% between Q1 2018 and Q1 2019 from $1,851 to $2,057.11
- Board of Governors of the Federal Reserve System: Report on the Economic Well-Being of U.S. Households in 2018
- Urban Institute: The Financial Health of Residents
- Elevate’s Center for the New Middle Class: African American Financial Experience: Prime and Non-Prime, February 2018
- Consumer Financial Protection Bureau: Data Point: Credit Invisibles; May 2015
- Elevate’s Center for the New Middle Class: Hispanic Financial Experience: Prime and Non-Prime September 2018
- Chase Slate 2016 Credit Outlook
- Prudential: The African American Financial Experience; 2015-2016 Prudential Research
- CreditCards.com: Many consumers stick with a favorite credit card at their own expense
- Experian State of Credit 2018
- Experian: Men vs. Women: Who Wins the Credit Game?
- Experian Millennials and Credit Card Debt Study