Millennials Land in “Hard to Get out of” Debt Situations
They were born between 1981 to the mid-’90s, the so-called “Generation Y.” Like their Baby Boomer grandparents and Gen-Xer parents, millennials’ characteristics are strongly influenced by the socio-economic and political environment in which they were born and grew.
They are said to be the “Generation Me” people. This is so due to their confident nature, narcissism (seen in the classic selfie behavior), and ‘entitlement’ mentality. Such attributes are likely to have been spawned by the digital technology that helped raise them to what they are now.
But for all their distinct characteristics, one cannot fault them for their ambitious streak to get a good education. However, this stretches their paying capacity way beyond their college years.
Worried about student loans
“Two-thirds of millennials aged 23 to 35 have at least one source of long-term debt, while one-third have more than one source.” Yellowbrick, a Chicago-based Psychiatric Center
Studies show that millennials have worries over their rising student debts. This is particularly true because of the ever rising cost of quality college education. Other concerns include owning a house and retirement.
With all these things to think about, young adults now find themselves searching for better and faster ways to be debt-free. To them, “completing school” does not mean the start of a new phase. Rather, being able to pay off debts and living debt-free signals the start of the next stage.
Their priorities differ with previous generations.’
Most millennials have been forced to “grow up fast” owing to their economic situation. Having a family is their last thought because they are extremely keen on paying off their student debts. As such they seek jobs during and after college.
For this generation, landing on a full-time, long-term job in line with their chosen field is the indicator of adulthood entry. All they think afterward is building their career and earning more money. They have debts to pay and a lifestyle to sustain. As such, they already have their hands full in the medium to long term.
As debts saddle most of them, there’s the tendency to be buried in further debts. These arise from credit card charges and their inability to make payments or fully pay off their loans.
The debt may further run deep if they are forced to take out personal loans as a means to survive. No wonder millennials are hesitant to move out the family residence, get their own property, settle down, and even buy cars.
They advocate for a strong background in personal finance management
They know the high cost—and the significance—of getting a good college education. As such, Millennials push for the inclusion of personal finance, debt management, and banking subjects in the high school curricula.
Having a firm grasp and deep appreciation of these things could help the younger generation deal with their financial situation better than their predecessors.This includes how credit cards work so as to be responsible users in the future.
What they can’t say “No” to
They encounter a “seemingly endless struggle” to get a degree and find a permanent, high-paying job. However, debt-stricken millennials feel far from desperate.
In fact, with bills to pay and loans to settle, the cash-strapped breed still finds a way to maintain sanity. “How?” You may ask. By not scrimping on certain things they cannot simply do without.
One is coffee, which gets them through the day and all through the night. This does not involve just one trip to the coffee store. Next on the list are the gadgets that keep them company at work and play. You won’t see them without these devices. They view the devices as extensions of themselves. It would be futile to advise them to sacrifice these things to save money to pay off their debts.