generation broke
You've heard of Generation X, Generation Me.What about Generation Broke?
I did a little searching today on the relation between youth and debt. I did this because I have noticed a little pattern in many of the PF blogs I read. I noticed that most of the authors are young ~ early 20's - 30's, and I also noticed many (not all) are located on the East Coast (specifically NJ & NY). I was curious if there was any information out there claiming that youth is taking a more proactive approach towards their finances, because it seems we all are! While I didn't search for hours, it seems I am mistaken, because all the articles highlight the mistakes we all have made - and only then is it that we rebound (if we're lucky) and clean up our act. There's too many to list, but this article is a good sample.
Here's the facts that stood out:
*Saddled with record-high college loans and credit-card debts at a time when wages are stagnant and the job market is tight, 'they' may be the most indebted generation of young Americans ever.
*The average graduate in 2002 owed $18,900 in student loans.
*Rents and housing prices have increased faster than inflation during the past decade.
*Young adults are more likely to hold temporary positions and jobs that don't offer healthcare benefits.
*While young people incur considerable debt just to pay for basics, they also get into the hole because of impulse spending.
*Americans between 25 and 34 have the second highest rate of bankruptcy, after those in the 35-to-44 age group.
*The average indebted adult between 25 and 34 spends nearly 25 cents of every dollar earned on debt payments.
Ouch. Guess I was a little too optimistic (and naive) to think things really aren't as bad as they seem.
posted by Karen @ 8:49 PM
5 Comments:
Interesting post..
I think what I'm seeing is that the young people are starting to learn from their parent's misuse of cash and credit for the last 30 years.
A generation has gone by and there is enough precedent set by the parents and older people for the younger generation to learn by. Credit cards have been somewhat mainstream for the last 30 years.
30 years would be more than a generation.
This is plenty of time for children and youth to see the problems of credit and over spending. Hopefully they will learn the lesson from the parents about what not to do with their money.
At the same time, kids are kids and need to make their own mistakes.
Hopefully the younger generation can find a balance.
Wouldn't it be nice if they taught good personal money mangagement skills in school? Maybe then we wouldn't all have to figure it out on our own (or for many, not figure it out at all)
Hazzard
Everybody Loves Your Money
I hope so Monty. If the next generation makes the same mistakes many of us do, but worse, where will that leave us?
Hazzard, it's funny you point that out, because someone that was intereviewed for the article in this post said had he been educated, he never would've gotten himself into this mess.
On a different note . . .I wonder if you comment on finance blogs says more about the demographic of bloggers . . .
This post has been added to the Carnival of Personal Finance #8!
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