We know that credit cards are a significant source of many Americans' debts. However, a recent study by the online lender LendingPoint found that personal loans are growing faster than any other type of personal debt.
They're becoming particularly popular with younger people, who use them to pay for major purchases and costly life events like moving and getting married. Some use them to consolidate their credit card debt. Almost 25 percent of people with personal loans are in the 18-to-35 age bracket -- compared to 12 percent just three years ago.
Why are younger people using personal loans instead of credit cards? One man says that he liked the idea of being able to pay off his debt and be done with it as opposed to constantly adding to it, as you can with credit cards. When young borrowers make their payments in full and on time, they also help build a good credit record, which comes in handy when they start shopping for a home.
Lenders have also made it easier to get personal loans online. Therefore, they're attractive to younger borrowers who are used to conducting much of their banking and other financial activities on their computers.
Older borrowers still get personal loans as well, but for different purposes than millennials do. Older people are more likely to use them to finance home improvements, medical bills and vacations.
There are a lot of loan options out there. However, at some point, creditors have to be paid back. If you're struggling with overwhelming debt, find out what your options are. Bankruptcy may be a better option than you think. It may be worth learning more about the types of bankruptcy available and how bankruptcy can help you get out from under your debt and move forward.