skip to main content

46% of Millennials Feel Held Back by Their Credit Score

Written by
Alex Huntsberger
Alex Huntsberger is a personal finance writer who covered online lending, credit scores, and employment for OppU. His work has been cited by, Business Insider, and The Motley Fool.
Read time: 7 min
Updated on July 27, 2023
young man and woman feeling held back by their credit scores while speaking to an older man
Our survey found that bad credit is taking a toll on young people in surprising ways.

Bad Credit Is Holding Back Millennials

Bad credit spells trouble at any age, and young people are not immune from its effects. In fact, our latest survey found that a shocking number of millennials are feeling the pinch, with 46 percent reporting that their credit score is holding them back.

What makes this number surprising isn’t that a big chunk of millennials have bad credit. (TransUnion found that 43 percent of millennials have subprime scores, compared to 20 percent for boomers and 9 percent for the silent generation.) Rather, what comes as a shock is that so many millennials are feeling the effects of bad credit so young, and it’s playing out in far-reaching ways.

What’s the Impact of Bad Credit on Young People?

For many older Americans, applying for a mortgage is the credit milestone that’s most significantly impacted by a low score. But bad credit can cause trouble long before that. Transportation, credit cards, housing—even though a lot of people don’t realize it, all of these can be impacted by bad credit. Our survey found that a significant number of millennials are struggling in these areas, precisely because of low credit scores.

  • 27% of millennials said a bad credit score had hurt their chances of buying a car.
  • 26% said poor credit had hurt their chances of getting a loan.
  • 23% said poor credit had hurt their chances of getting a credit card.
  • 25% said poor credit had hurt their chances of getting an apartment or a house.
  • 14% said they lived with roommates because they couldn’t rent on their own due to bad credit.

Car Loans

Buying a car is a rite of passage for many young people. But buying a car outright—even a cheap one—is outside the price range of most. The solution? Finance it.

While most people will qualify for an auto loan, the rate at which it’s offered will depend in large part on a borrower’s credit score. And, unfortunately, those with bad credit can expect a much higher cost. How much higher? Subprime borrowers will likely pay an interest rate four times that of borrowers with excellent credit.

Our survey found that 27 percent of millennials blame their credit score for preventing them from getting a new car.

Loans and Credit Cards

Another part of young adulthood is a first taste of financial independence. This includes a job to—hopefully—make ends meet, but rent and bills too. Loans and credit cards are also usually a part of this new reality.

Twenty-seven percent of millennials in our survey said they don’t apply for credit cards because they think they’ll be denied. A further 23 percent said bad credit had hurt their chances of getting a credit card in the past. Additionally, 15 percent said they regularly miss payments and their credit card debt is unmanageable.

With loans, millennials face similar difficulties. Twenty-six percent of respondents said a bad credit score had hurt their chances of getting a new loan or line of credit.


As young people more and more delay home ownership, it might seem that bad credit would impact their lives less and less. But this isn’t the case.

Our survey discovered that a significant percentage of millennials feel hindered by their credit score as they make housing decisions. A full quarter (25 percent) of millennials reported that bad credit had hurt their chances of getting an apartment or a house. And 20 percent of millennials said they can’t buy a home because they think their mortgage application will be denied.

For some millennials, the impact of bad credit on housing options has left them struggling to move beyond a dorm-like lifestyle. Fourteen percent said they’re forced to live with roommates because their credit prevents them from getting their own apartment.

Who’s to Blame?

Many would argue that part of being young is making mistakes. And certainly, we found that some of the credit damage that millennials suffer is due to easy-to-avoid mishaps.

Of the millennials who missed credit card payments in our survey, 36 percent said they simply forgot about it. Another 10 percent said they had a bill they didn’t know they had to pay. This means that nearly half of those who missed credit card payments could have avoided them if they kept better track of their bills or set up autopay on their accounts.

However, our survey also found that a significant percentage of millennials felt they were unprepared to tackle the financial challenges that tanked their credit. Twenty-four percent said they had received insufficient education about habits and techniques that build a strong credit history. It might not be surprising, then, that 15 percent of millennials said they regularly miss credit card payments, and 43 percent described their credit card debt as unmanageable.

How Can Millennials Avoid Bad Credit?

Bad credit is tough to fix. Black marks usually stay on a credit report for seven years, and even though lenders typically give more weight to recent credit history, a missed payment from long ago can still show up to haunt you.

The better option is to avoid the mishaps that sink your credit in the first place.

While going back in time isn’t possible, young people with short credit histories are in a position to put themselves on the right path early on. And it’s never too late to build good money habits, because even if mistakes have been made, good money habits and a strong credit history can help to counteract them.

To help millennials keep their credit healthy, we put together a list of money hacks designed specifically for the lives of young people. (Many of them are good advice for older generations, too.) These seven tips offer simple, concrete ways that millennials can avoid credit damage and begin to build a strong credit history.

  1. Use a free budgeting app. Budgeting apps are a thing, and they’re perfect for tech-savvy millennials. They keep you organized and honest. Take advantage of them.
  2. Check your credit report. You can get a free credit report once a year upon request. Visit for yours. Knowledge is power.
  3. Go cash-only. Credit cards are easy to overuse, but with cash, you can’t spend what you don’t have. Make a budget and withdraw “fun” money once a week. Once it’s gone, you’re done until next time.
  4. Set up automatic payments. Use these to avoid late fees and credit damage. But be careful: if you don’t have funds to cover the bill, you’ll overdraw your account. If you’re on a tight budget, consider setting your plan to pay the minimum amount due, and deal with the rest manually.
  5. Call if you’re behind. Creditors lose money when they sell your debt to a collection agency. If you’re behind, they might be willing to negotiate with you. It doesn’t always work, but it’s worth a try.
  6. Close old utility accounts. Millennials move around a lot. In the shuffle, it’s easy to forget to close an account. Don’t let a silly slip-up damage your credit.
  7. Open a savings account. Millennials know it’s often too easy to withdraw money from a checking account. Set up a separate savings account and get in the habit of making regular deposits. Bonus: you’ll earn interest, and that’s a wonderful thing.

Survey Methodology

This survey was commissioned by OppLoans and conducted by OnePoll. It ran from June 7 to June 19, 2018. Two thousand Americans ages 18 and older were surveyed. One thousand respondents were between the ages of 18 and 34 and defined as “millennials.” OnePoll is a member of the European Society for Opinion and Marketing Research and employs members of the Market Research Society.

Fair-Use Policy

All data and images in this report are free to share and post. However, please provide a link back to this page to ensure context and accuracy.

California Residents, view the California Disclosures and Privacy Policy for info on what we collect about you.