CHICAGO—The nation’s youngest and oldest consumers are changing how they borrow, according to a new study from TransUnion.
Moreover, the consumer loan wallet is evolving, with the company citing some significant changes in the last 10 years. The average balances per borrower with a student loan increased 61% – from $15,853 in 2005 to $25,525 in 2014. At the same time, the percentage of credit-active consumers ages 20-29 with a student loan also has risen from 31% in 2005 to nearly 51% in 2014.
Wallet share and balances for auto loans rose with the 20-29 age segment: wallet share increased from 11.6% in 2005 to 14.1% in 2014, while the average balance per auto loan borrower rose from $13,721 to $14,637.
The biggest declines in wallet share for consumers ages 20-29 are in mortgage loans and, to a lesser extent, credit cards. Consumers age 60 and older are taking more loans in every key lending category, even student loans. The rise in student loan debt for this group is similar to the one observed for the 20-29 age group, Transunion found. While the percentage of older Americans taking out student loans has not changed, the average student loan debt per borrower with a student loan has risen from $14,696 in 2005 to $27,168 in 2014. From 2009 to today, those 60 and older have boosted their participation rates in other loan categories, including credit card, auto and HELOC.