Affirm announced the results of its research into the nuances surrounding consumers’—especially millennials—relationship with debt and credit.
Drawing upon a survey of 1,089 U.S. individuals between the ages of 22 and 44, the study reveals that while a large percentage of consumers worry about the mismanagement of credit cards, they are simultaneously open to a healthy amount of debt. Consumers recognize the necessity of credit, but have real concerns about its sometimes confusing terms.
Key findings include:
- 65 percent of respondents have an actual fear of debt.
Almost a third (32 percent) are fearful because they don’t know how long it would take to pay off - Consumers think of their spending in defined time increments:
93 percent plan their spending weekly, twice monthly or monthly
42 percent of millennials (ages 22 – 34) plan their spending on a weekly basis
Only 5 percent said they don’t plan their spending at all - Nearly 3 out of 4 (72 percent) respondents who have carried a credit card balance have worried about how much their purchases would end up costing in total (including interest)
- 46 percent of respondents who have carried a credit card balance have enjoyed purchases less due to carrying that balance
- 87 percent of respondents expressed interest in a simple way to pay for large purchases over time that was not a credit card
68 percent of these respondents cited “knowing exactly how much I’ll owe and when, including interest,” as the most appealing element of a simple credit card alternative
“This research illustrates just how much of an impact uncertainty can have on consumers and their buying decisions,” said Affirm Insights & Credit Analyst Ethan Monreal-Jackson. “Consumers are hungry for transparency and credit card alternatives that would allow them to responsibly spend. At Affirm, we’re proud to bring honesty to consumer credit, providing consumers the flexibility they need to buy now and pay later without any fees, compounding interest or other surprises.”
