Latest news with #LindsayBryan-Podvin
Forbes
24-04-2025
- Business
- Forbes
Why Gen Z Is Breaking Up With Credit Cards
Woman at cafe making mobile payment getty According to new research from Cash App Afterpay, more than half of Gen Z say credit cards feel outdated, anxiety-inducing, and incompatible with how they want to manage their money. Unlike previous generations who saw credit cards as a rite of passage or a symbol of financial freedom, Gen Z is redefining what financial empowerment looks like—and credit cards don't make the cut. 'Credit cards give Gen Z the 'ick'—not just because of high interest rates and confusing terms, but because they feel outdated and anxiety-inducing,' said Lindsay Bryan-Podvin, Cash App Afterpay's Financial Therapist. 'Credit cards clash with how Gen Z wants to manage money. They want clarity, structure, and control in real-time, which is why they're embracing alternative tools like debit cards and BNPL that offer greater transparency, flexibility, and speed for responsible spending and managing their cash flow.' Credit cards also feel cumbersome. 'For a generation used to getting things with the tap of a button, having to go through the tediousness of applying for a credit card and then waiting for it to arrive isn't as integrated and user-friendly as BNPL,' Bryan-Podvin added. Charlotte Principato, a financial services analyst at Morning Consult, echoed these sentiments. 'Gen Zers are entering adulthood without being bombarded by credit card offers the way millennials were, with a heightened understanding of the dangers of credit card debt after seeing its impact on older generations,' she said in an interview with Forget bubble baths and yoga—Gen Z is bringing financial wellness into the self-care conversation. They're prioritizing tools that help them stay mentally and financially balanced, with ease and autonomy at the center. 'Gen Z is redefining self-care, and extending those values to include financial wellness,' said Bryan-Podvin. 'They're prioritizing payment methods that support ease, autonomy, and mental well-being. Debit cards have become their go-to, with 68% preferring them (and BNPL options) over credit. There's greater peace of mind with clarity, and no fine print or surprise interest. That's also why 90% of Afterpay customers link their debit cards for installment payments—it helps them manage cash flow without added stress.' Gen Z came of age during economic chaos—witnessing the aftermath of the Great Recession, watching parents and older millennials wrestle with credit card debt, and now navigating inflation and record-high living costs. 'Gen Z is entering adulthood during a time of economic uncertainty, inflation, and rising living costs,' said Bryan-Podvin. 'They're more cautious and financially aware from seeing past generations struggle with debt and the Great Recession, and are far more skeptical of tools that don't serve them. Our survey found that 63% of Gen Z have already walked away from credit cards entirely. This isn't just a shift but a generational reset, making it clear that credit doesn't align with their reality or their values.' Here's the bottom line: Gen Z doesn't see credit—they see debt. 'For Gen Z, using a credit card can feel like spending money they don't actually have. In fact, 70% of adults say credit cards give them that exact feeling,' Bryan-Podvin explained. 'Credit cards are built to make spending feel easy; however, too easy can be dangerous. One of my financial therapy clients once reframed their credit card as a 'debt card,' and suddenly became way more mindful of their habits. That simple mindset shift can be a game changer, and it's one Gen Z is making in real time.' As this generation continues to influence market trends, financial institutions may need to adapt to meet their evolving preferences—because when it comes to credit cards, Gen Z isn't just uninterested. They're actively opting out.
Yahoo
23-04-2025
- Business
- Yahoo
Bankrate debunks these 10 credit card myths
Plenty of myths exist about how credit cards work. Falling victim to credit card myths could have a negative impact on your credit score. Doing your research when it comes to facts about credit cards is key to protecting your financial health. Before I started writing about credit cards in February 2018, I had all kinds of thoughts about how they worked. My three-year stint as an editor at The Points Guy opened my eyes to what's real — and what isn't — when it comes to keeping your credit score high and your credit history clean. Your FICO credit score — one of the two most commonly used credit scoring models, in addition to VantageScore — is determined by five factors. Keeping track of these factors goes a long way toward keeping your score in the good range (which starts at 670 on a scale of 300 to 850). There are a lot of myths attached to the acquisition and use of credit cards, and when you believe the bad ones, your score could suffer. Below I share 10 credit card myths and offer some credit card facts. Credit card myths tend to persist because figuring out a credit score can be very confusing, says Lindsay Bryan-Podvin, a financial therapist, licensed master social worker and founder of the website Mind Money Balance. 'Your score is either in the weeds and you need to hack it, or it's bad and you should avoid dealing with it at all costs,' she says. To add more confusion, some of these myths can have a bit of truth to them. 'For example, your income does not affect your credit score, but your income is a consideration when it comes to qualifying for a loan or qualifying for how much credit you are extended on a credit card,' says Bryan-Podvin. False. Your income doesn't show up on your credit report. Instead, credit card issuers check your credit report, credit score and past payment history to ensure you can be trusted to pay your bills. Those with low-to-moderate income are just as likely to get approval for a credit card as someone with a high income, if you have a record of paying bills on time. False. Card balances can hurt your credit score, especially if your credit utilization ratio is high or you don't make payments on time — two of the five factors that determine your credit score. You also end up paying more for your credit because interest charges stack up on outstanding balances. Paying off your balances every month shows that you're a responsible cardholder and keeps your credit score high. So as long as you do not have any debt on your active credit lines, you should have a high credit score. Use your no-balance credit cards to pay bills every so often so an issuer doesn't close your account due to inactivity. True, but… It's natural to see your credit score drop a few ticks after you apply for a credit card. But if you make card payments on time and keep your credit utilization ratio down, your score should bounce back within 6-12 months. Once the new credit line is added to your report, your score may actually increase if the new credit available to you improves your overall credit utilization ratio. False. It's tempting to consider using these companies to 'fix' your credit score. The truth is that while these companies charge money and promise to remove information from your credit report, they don't have the power to raise your credit score instantly. Save your money and do the work yourself instead. Order a free copy of your credit report at comb through it for inaccuracies and dispute any information that looks incorrect. If you need help, reach out to reputable nonprofit credit counselors that can help you create a debt management plan. It takes time, but if you stick with it, your credit score will rise. False. When you cancel a credit card, your score may take a hit if your credit utilization ratio drops. Your account history is another factor FICO uses to determine your credit score. When you cancel a card, the length of your credit history may change, which could also negatively affect your score. Instead, if your card has no annual fee, keep it in your sock drawer and use it every so often to keep it active. If the card has an annual fee, check the length of its credit history. If it's among your oldest cards, you might want to keep it and pay the annual fee to avoid the credit score drop that could happen if you cancel the card. If not, the potential score drop may be worth the money you'll save if you decide to cancel the card. False. It sounds counterintuitive, but the type of credit you have accounts for 10 percent of your credit score. The three credit reporting bureaus want to see a mix of credit, such as credit cards, a mortgage, a home equity line of credit, a car loan, a personal loan or student loans. If you have a wallet full of credit cards, but no loans, your credit score could be negatively impacted. False. Student loans, like any other type of loan, are included in your credit report. Not paying them on time hurts your payment history, credit history and credit mix — three important factors that determine your credit score. Student loans are a type of installment loan, similar to a car loan, personal loan or mortgage. Paying on time could help your score. Be late or skip a payment, and your score may drop. False. Each person in a marriage has their own credit score, since credit reports don't include your marital status. Once you're married, you're not responsible for each other's pre-marital debt. However, if you and your spouse apply jointly for a credit card, an issuer will consider both credit scores when making a decision. If approved, you're both responsible for that debt. True, but… Payment history accounts for 35 percent of your FICO credit score. If you miss a payment (even a minimum one), it might be reported to the three credit reporting agencies, which may cause your credit score to drop. If it was a one-time mistake, you can ask the three credit bureaus for forgiveness to see if they'll remove the missed payment from your credit report. Avoid this in the future by setting calendar reminders or phone timers so you don't miss your payment due dates. False. You should check your credit report at least once a year, although you can order a report weekly for free through Review your reports from each bureau for inaccurate information that could negatively impact your credit score. Doing so can also help you catch fraudulent activity on your cards. Credit card myths can sound perfectly credible, says Bryan-Podvin. 'But it's important to take a beat and say 'this was something I believed, but let me figure out how true it is and if this particular myth is impacting me,'' she says. However, ignorance of your credit score and details on your report can have a catastrophic impact on your credit. In a worst-case scenario, negative information submitted by the three credit-rating bureaus could take up to seven years to be removed from your credit report, making it much harder to apply for credit cards and loans. You also face paying higher interest rates on financial products. Check out Bankrate's credit resources section for more information. Sign in to access your portfolio
Yahoo
23-03-2025
- Business
- Yahoo
3 Money Habits Millennials Have That Are Different From Their Parents'
Millennials have taken a lot of heat over the years about their financial habits, with some thinking that the generation is prone to making frivolous purchases rather than focusing on their personal finances. The reality, however, is that many differences can be explained by the broader economic circumstances, like soaring costs of housing and education. For example, while the cost of electronics has plummeted since 1990, college tuition has risen over 400%, while costs of other critical areas, like housing, healthcare and daycare, have risen faster than median wages, according to a 2024 analysis by the U.S. Department of the Treasury. Read Next: Explore More: Still, millennials are finding ways to respond to these circumstances. 'Millennials are redefining financial wellness by prioritizing adaptability, financial transparency and systemic awareness in ways that set them apart from previous generations,' said Lindsay Bryan-Podvin, LMSW, a financial therapist and founder of Mind Money Balance. Specifically, they're embracing the following money habits that differ from how their parents approach personal finance. Also see the four worst mistakes millennials can make with their money — and how to avoid them. Coming of age in the internet era, millennials are often utilizing technology more in their financial lives than their parents do. For example, millennials are utilizing automation, such as autopay and autosaving features, along with budgeting apps and digital banking tools, according to Bryan-Podvin. Millennials are also utilizing peer-to-peer payment apps to send money quickly to friends, as well as technology like buy now, pay later (BNPL), she said. That's not to say that technology like BNPL is always advantageous, but if used wisely, it can be more affordable than going into credit card debt. Be Aware: Another key differentiator is that millennials are often using their purchasing power to align with different values. 'Millennials prioritize spending on experiences over things, a shift from their boomer parents, who valued homeownership and accumulation of 'stuff' as markers of success,' Bryan-Podvin said. 'While the boomer generation may turn their nose up at it, millennials are willing to pay more to purchase from values-driven stores and companies.' Lastly, some millennials are pushing for systemic change to help overcome some of the broad barriers this and younger generations face. 'Millennials are more likely to side-eye the old 'pull yourself up by your bootstraps' narrative. This generation recognizes external factors like wage stagnation, housing affordability and student loan debt aren't just personal challenges but systemic issues,' Bryan-Podvin explained. In fact, according to an October 2024 survey from Independent Center, millennials and Gen Z are reshaping the American Dream to align with more current challenges and opportunities, citing an increased difficulty for younger generations to buy a house, start a family and save for retirement. Despite systemic factors, millennials have to play the hand they're dealt to some extent — and they can potentially utilize those cards better by also incorporating some lessons from their parents. 'Since time-traveling and being born into a more financially prosperous time isn't an option, here are a couple of things millennials can borrow from their boomer parents to help them financially,' Bryan-Podvin said. One is to scrutinize whether something that is 'on sale' is really worth the money at all, she explained. Even if you can't always cut your way to financial success, there can still be some truth to people falling into the trap of overspending. 'I remember spending my restaurant hostessing money on new clothes from the mall, excitedly telling my mom I 'saved' because they were on sale. Her retort was almost always a version of 'you aren't saving money when you're spending it.' Irritating? Absolutely. But as an adult, I find myself turning to her wisdom when I add another thing to my cart because it's 'on sale.'' Bryan-Podvin said. Another tip is to invest early and consistently. 'While a pension can seem like financial lore, boomers benefited from small, consistent investments over time. Millennials can and should start investing in their figure via an employer retirement plan or contributing to their own IRA. Even $25 per month compounds over time and can make a large difference in their future,' Bryan-Podvin explained. Lastly, consider the role of jobs and longevity in certain positions could help finances. 'While I'm not suggesting that anyone stick out a toxic job, boomers stayed with their employers longer. There's a balance between job-hopping and strategically maximizing benefits and stability; for millennials, it's worth considering the financial security of a less-than-ideal job before leaving,' Bryan-Podvin said. More From GOBankingRates Who Would Benefit the Most from Trump's Social Security Tax Plan I'm a Retired Boomer: 6 Bills I Canceled This Year That Were a Waste of Money25 Creative Ways To Save Money This article originally appeared on 3 Money Habits Millennials Have That Are Different From Their Parents' Sign in to access your portfolio
