How Age Affects Credit Card Purchases
Wednesday, December 5th, 2007Everyone that you know probably has credit cards. You see them pay regularly for items purchased at stores, dinner purchased at restaurants and travel tickets purchased online. Because we see credit cards all of the time, we often make the assumption that everyone is using theirs to buy the same types of things that we are. However, that’s not the case. People tend to make different types of credit card purchases depending on the age at which they are using their credit cards.
For example, college-aged students are most likely to use their credit cards on a combination of daily living expenses. Because they don’t have a stable source of income, they often find that they have to use their credit cards to purchase their groceries and textbooks. This frequently happens as a result of the fact that they may be living off of student loan money which only comes in once or twice a semester. Poor budgeting causes them to run out of that loan money a month or two before the next check arrives. Until it comes, they use their credit cards to get by.
In contrast, individuals who are in their late twenties and early thirties are most likely to use their rewards credit cards on luxury purchases. The majority of these are purchases designed to impress others. They have graduated and have jobs so they can afford to pay for their daily living expenses without using their credit cards. What they can’t afford is the designer suit that will make them appear more professional at the office, the sporting event tickets that will impress their new friends or the hot new dress that will impress the date they met online. People in this age bracket want to live above their means in order to establish themselves in their careers and relationships. They use credit cards to do this.
Once the career and relationship are settled, the average person heads towards family life. This is the reason that most people in their late thirties and throughout their forties will be using their credit cards to pay for family expenses. Kids aren’t cheap. Sure, your paycheck at this stage in life can pay for their food and the clothes that they so quickly grow out of. But kids today require technological gadgets, dance lessons and private schools. Many parents at this stage of life find themselves using credit cards to pay for these extras so their children can live quality lives.
Once the kids move on, parents start using credit cards to get some along time together. People in their fifties are most likely to use airline credit cards on travel. They still work and so don’t have to worry about everyday expenses being covered. However, they’re paying college tuition and the rest of their mortgage so they don’t have travel money. They use credit cards to get themselves around the world. After retirement, they’ll come full circle and start using their cards on daily living expenses again.
