Teens 'want to borrow but cannot budget'

By Sarah Engle, Wed 21 May 2008 - Published in Loans

The next generation of borrowers want to take out credit cards and loans when they turn 18, but are not able to successfully manage basic budgeting tasks, new research has found.

A study conducted for the AXA Financial Task Force has found that teenagers are willing to take out loans and credit cards as soon as they turn 18, despite the fact that they cannot manage a basic weekly budget.

"[The research] emphasises what a huge challenge budgeting can be when you're still relatively new to managing money and making regular financial decisions," said Professor Nick Chater, a member of the tack force.

He added that many teenagers are about to leave home for the first time and while many may approach money with diligency, others may simply not be able to cope.

A spokesperson for AXA added that few teenagers succeeded in the task of meeting budgets, even though they have tried very hard to succeed in such a challenge.

And therefore steps need to be taken to see how people can be motivated to better control their finances, the company claims.

Last month, AXA advised consumers to seek out advice over inheritance tax regulations so they did not lose any benefits.

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