More and more young people with payment problems
According to the BKR, the number of young people up to the age of 24 with payment problems has increased by almost 70% in the past 5 years. A payment problem means that someone is behind in payment or has a debt settlement with a credit provider. Payment arrears are common with rent, credit cards, mobile providers or when paying off a loan.
The BKR reports that 1 in 7 consumers with payment problems are young people up to the age of 30, almost 99,000 people. That does not seem like much, but it is indeed worrying due to the increase of almost 70% compared to 5 years ago. Student debts are also increasingly common. Information about student debts must therefore be improved, so that young people are less likely to get into financial problems after their studies. This is evident from a panelwizard investigation commissioned by the BKR .
Central counter with debt overview?
Student debts weigh heavily on the shoulders of young people, but are not registered with the BKR. This can cause problems later in life, for example when applying for a mortgage. Because the debts of former students do not count towards a mortgage application (with the BKR check), while they are indeed part of the fixed costs. This can create a double financial burden: mortgage and student debts, with all the associated consequences.
Currently, a number of important debts are not registered with the BKR anyway , which can cause financial problems. Then it not only concerns student loans, but also arrears with the tax authorities or health insurers.
In order to give consumers a good overview of all their possible debts, more and more people are lobbying for a central counter. Here, every Dutch person should have easy and free access to his / her loans , debts, payment arrears, but also study debts.
Our method: prevent payment problems due to higher age limit
Back to borrowers under 30. We have already noticed that young people exhibit worse payment morality than consumers over 30 years old.
How that is? We see a number of trends:
- Young people have built up even less wealth and often have to make do with a flexible employment contract. That makes them more financially vulnerable.
- At the same time, many young people live beyond their financial means: an expensive smartphone, distant vacations and eating out regularly. Parents also play a role here: young people have become accustomed to a certain luxury from their parental home. Once living on its own, it is difficult to start from scratch and live according to income. Not all parents teach their children that luxury and a high standard of living cannot be taken for granted and that you should also learn to start with little.
- Young people are more often in debt in order to still be able to lead the life they are used to from home. Debts that would not be necessary for a more realistic financial education, but which can cause serious - and long-term - problems.
- The corona crisis has also put many deeper into debt, through unemployment or overdue / reduced salary payments. Young people have been hit extra hard by their often temporary / flexible employment contracts.
Borrowing money can sometimes be unavoidable for a large purchase or the payment / transfer of debts . But in a well thought-out way, whereby the monthly costs are in proportion to the income.
We are a great supporter of responsible borrowing and therefore apply a somewhat higher minimum age for young people / young adults. In our opinion, nobody gets into unnecessary financial problems and certainly not because of a much too expensive loan at much too young age.
From a legal point of view, the age limit for consumer credit is 18 years. However, we apply 21 years for young people with a rental / owner-occupied home and 29 years for young adults living in or at home.
Apply for a responsible loan?
There is nothing wrong with borrowing money, as long as it is done in a financially safe way. Do you want to apply for a responsible loan?
The same day you will receive a realistic offer from a maximum of 5 banks, based on your age, income and personal situation.