Are millennials finally getting smarter about money? It’s a mixed bag: While fewer would hit up the Bank of Mom and Dad for a loan, more say they’d rely on credit cards to pay for an unexpected expense, according to the findings of a new Bankrate.com survey.
When asked how they would pay for an unexpected expense in an emergency, 37% of Gen Y respondents said they would use their savings, an improvement from the 33% who gave that answer when Bankrate asked the question last year. Millennials were also less likely this year to say they’d cover an unexpected $500 car repair or $1,000 emergency room bill by hitting up friends or family for money — 21% compared to last year’s 24%.
So that’s good, since it’s an indication that more millennials actually have savings to draw from. The flip side is that 12% said they’d use credit cards to deal with an unexpected expense, compared to 7% who said so last year. Millennials’ relative lack of interest in credit cards compared to other age brackets has been the financial saving grace for this underemployed, student loan-saddled generation, so their shift from parents to plastic as a source of emergency funds isn’t necessarily a good thing. There was also a huge drop — from nearly a third to less than a quarter — who said they’d deal with a big, unexpected bill by cutting back on spending.