00.01am 12 Decemeber 2017
Millions of young Brits are in danger of stepping into adulthood in debt, with one in four (24%) 16 and 17 year olds being offered credit cards despite not being able to apply for one themselves under existing law.
Although under 18s are not allowed to enter into their own credit card contract, receiving material may encourage them to do so as soon as they can. By the time youngsters hit 18, debt becomes a reality for one in three (30%) who sign up to credit cards. A fifth (21%) are also relying on their overdraft and over one in 20 (7%) – that’s 54,000 18 year olds – are even taking out personal loans.
The research, commissioned by comparethemarket.com who polled 1,000 16-18 year olds about their current financial habits, follows a recent warning from Andrew Bailey, chief executive of the Financial Conduct Authority, of a "pronounced" build up of debt among young people.
Right now, the new research shows that over a quarter (27%) of 16-18 year olds admit to not feeling in control of their finances. And of those in control, two-thirds (63%) cite family support as the reason for staying afloat.
It seems many youngsters are being influenced by the high-living displayed by their favorite celebs on social media. Three in ten 16-18 year olds admit to being inspired to push their spending by celebs Instagram and Snapchat posts. Rhianna tops the list of celebs who inspire young females, while boys are more likely to be sucked in by the spending habits of Ed Sheeran and David Beckham.
Youngsters are seemingly taking a material approach to spending, with many admitting they will borrow money for non-essential items like clothes (10%), holidays (14%) and games consoles (7%).