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Millennials take a lot of flack when it comes to their money management. For instance, nearly 4 in 5 don't invest in stocks, and two-thirds think they'll never be able to sock away $1 million for retirement. And of course, there are the ever-rising student loans: Among this year's grads who borrowed money to finance their higher education, the average student loan balance is $37,172, up 79% in the past 10 years.

Given the doom and gloom, it might not seem a stretch to assume that millennials are also suffocating under the weight of credit card debt. But that's not the case, according to a recent New York Times analysis of data from the Federal Reserve. In fact, the percentage of Americans under 35 with credit card debt is the lowest it's been in 27 years.

What's behind this restraint is an open question. Millennials may have decided their student loans are already more than enough debt, or they may have drawn lessons from their parents' struggles during the subprime mortgage crisis. Whatever the cause, millennials' aversion to credit card spending may actually work against them for three major reasons.

1. Responsible credit card usage boosts credit scores

A good credit score is crucial for some of life's biggest purchases. Mortgage lenders, spooked by the subprime-loan crisis, are pickier than ever about credit. Good scores are also essential for nabbing low-rate car loans. Landlords and potential employers may even check the credit of potential renters and workers to judge their fiscal responsibility and even their character.

One of the main factors that goes into determining someone's score is their credit history. According to FICO, 15% of a person's score is based on the length of credit history -- but it's tough to amass a lengthy credit history while avoiding credit cards entirely. In addition, 10% depends on having a good mix of credit types -- and credit cards are one of the biggest pieces of this puzzle.

2. Credit cards offer benefits that other payment methods don't match

The Times article notes that millennials are turning to debit cards and payment services or apps such as PayPal and Venmo. Others have embraced prepaid debit cards they must load themselves with cash.

So what's the downside of these other payment methods? First, credit cards offer buyers a level of fraud protection that cash and debit transactions don't match. With a credit card, federal regulations mean users are usually looking at a maximum loss of $50 after a fraudulent transaction, and major issuers' zero-liability policies mean they probably won't lose even that. With a debit card, how soon the owner notices the fraud can come into play: Within two days, they may only lose $50; up until 60 days, they could be out $500. After that? Well, they may be out of luck completely.

It's also worth noting that credit cards offer other benefits and protections. Some offer purchase protection against damage or theft on certain items purchased with the cards. Others may extend warranty coverage on certain items. 

3. Credit cards are the least of several debt evils

Fear of credit cards may also lead millennials to choose sketchier ways to make ends meet. A recent PricewaterhouseCoopers study found that 28% of college-educated millennials -- and 50% of those without a college degree -- have used "alternative financial services" such as payday lenders, auto-title loans, or pawn shops.

The appeal of these loans is obvious: They typically offer a quick cash infusion and no credit check. Payday loans require borrowers to post-date a check for the amount of the loan plus fees and interest, while auto-title loans use vehicles as collateral. But the interest rates are nothing short of astronomical -- typically in the triple digits, with interest rates on payday loans approaching 400%. (Suddenly that maximum 29.99% APR on credit cards doesn't look so bad, right?) It's also very easy for borrowers to renew the loans instead of paying them back, setting off a cycle of extremely high-interest debt.

Secured credit cards are an easy way to test the waters

Short of shunning credit cards, what's a debt-wary millennial to do?

Instead of exclusively turning to debit cards, prepaid cards, or sketchy high-interest loans, a better alternative is a secured credit card. These cards are tailored to users with poor or limited credit histories, and they require a small cash deposit -- say, $250 or $500. Cardholders can then charge up to the amount of the deposit, though some lenders may extend a slightly more generous limit. The deposit is a win-win: It protects the lender in case users fall behind on payments, and it keeps the cardholder from overspending.

The key to making the most of secured credit cards is paying them off promptly every month -- practice makes perfect -- and making sure the lender reports to all three credit bureaus. That way, cardholders get due credit for responsible behavior, boosting that all-important credit score. They'll also get the beefier fraud protection that credit cards provide, along with much lower interest rates than payday loans and their ilk can offer.

After some time, lenders may be willing to ditch the training wheels and upgrade cardholders to a non-secured card with a higher credit limit. Given the benefits a responsibly used credit card can bestow, that should be a change millennials welcome with open arms.