I saw a headline in the Chicago Tribune on Tuesday, September 9th. The headline said: “Majority of millennials’ pocketbooks lack plastic.” My first thought was: good for them. Maybe that generation will avoid the depths of a financial crisis like the one spawned by the baby boomer generation. But the article itself had a very different tone.
“The responsible use of credit cards is one of the easiest ways to build a strong credit score, which is essential (my emphasis) for qualifying for insurance policies, auto and mortgage loans, and sometimes even a job.”
Paying cash, which used to be a sign of responsibility, is now a risky lifestyle choice. How did it come to this? What does the credit score really mean? It means we are good little consumers. We take on an appropriate amount of debt by borrowing the “right” amount of money to buy crap we probably do not need. It’s more a report card on your consumption efforts than a report card on how financially responsible you are.
According to the article, business is using it in ways that will penalize those who eschew credit. If your insurance company, or employer, finds you do not have a credit score – that is as much a red flag as a poor credit score. That’s too bad. I always thought you should use credit only when necessary. I always thought paying cash was more financially responsible. Guess I’m wrong by today’s standards.