Apple may be bracing to ship 20% fewer iPhones later this year after its newest models, specs of which leaked earlier this week, finally hit the market, but that doesn’t mean the cultural cache of owning an iPhone has in any way diminished. While reports of a decline in component orders earlier this year could be chalked up to market saturation or the higher price point (consumers could be asked to shell out as much as $1,400 for the most expensive new models, according to reports that have been circulating since before last year’s launch), an interesting new survey by WalletHub revealed that many American handset owners simply don’t care about the price.
Indeed, at a time when total household debt is hitting one record after the next and revolving credit is soaring, nearly 28 million Americans believe that owning the newest iPhone is worth racking up debt. According to WalletHub’s 2018 Credit Score and iPhone survey, this view is particularly prominent among millennials. More than 18% of respondents under the age of 45 said it would be worth going into debt for the phone, compared with 5% of those who are more than 45 years old.
Despite the deluge of debt being incurred by the American consumer, credit scores remain generally high (unsurprising considering the robust Trump-era economy). Thanks to this trend, millions of consumers can access financing plans that will help them purchase new phones, ensuring a bump to device sales for the first company publicly traded in the US to reach $1 trillion market cap.
Here’s a summary of some of the study’s key findings (courtesy of WalletHub):
5X more millennials say the new iPhone is worth going into debt for than baby boomers.
29% of cell phone shoppers don’t know they could be in for a credit check.
Nearly 187 million Americans trust Apple and Google more with their personal data than the government.
19% of people would rather have unlimited phone data than an excellent credit score.
44% of millennials believe their cell phone has a bigger impact on their life than their credit score.
While overextending one’s debt burden (particularly if the item is purchased using a high-interest revolving credit line) is never a good idea, it’s particularly dangerous during periods of rising interest rates – as borrowers who agreed to risky adjustable-rate mortgages during the Bush era will no doubt remember. But maybe we’re looking at it backwards: Perhaps consumers should be grateful that Apple hasn’t decided to hike the price up even more. After all, the iPhone is “enormously underpriced,” according to the world’s third-richest man.
All of this begs the question: Would Warren Buffett still be buying Apple stock if he didn’t expect the company would soon buy it back from him at a premium?