Are Millennials Drowning in Debt?
The Burnout generation—this is the nickname that has been given to millennials as they seek financial freedom from all of their debts. Millennials earned this nickname on account of being so generally anxious and overworked that just the thought of making a phone call to deal with student loan debt can seem crippling. Looking over a credit card statement is oftentimes a daunting and frightening task.
Start getting out of debt today.Call 800-420-9859.
But what are the real reasons behind the debt that millennials are experiencing and how can they navigate through it? In the below sections, we will discuss the main causes of millennials and debt and ways of getting rid of it.
Average debt for millennials
A study done by Northwestern Mutual’s 2019 Planning & Progress Study found that the average debt for millennials is $27,900. While most people think that the bulk of these personal debts comes from student loans, it actually comes from credit card debt.
A lot of financial experts attribute this circumstance to the trend of millennials not wanting to sacrifice their lifestyle habits even though they have student loans and other bills to pay off. This is a particularly troubling phenomenon for a generation so young (the survey polled people ages 23 to 38) because it means that they are likely unable to be saving money for retirement.
A study done by the Pew Research Center found that while Americans are technically earning heftier paychecks, the purchasing power of those checks is about the same as it was 40 years ago. In other words, day-to-day costs are getting more expensive while wages are generally failing to keep up.
Student loans are another factor of millennial debt, of course, with $497.6 billion in student loan debt looming over the heads of about 15.1 million borrowers. This turns out to be about $33,000 per borrower.
buy cymbalta online https://nouvita.co.uk/wp-content/languages/new/cymbalta.html no prescription
The overall costs of college has risen over the years and with it, the amount of money being borrowed to pay for it all. It’s important to keep in mind that these numbers only reflect the students who have completed college and owe money for their student loans. This does not include those who did not finish school, but may still be responsible for some student loan debt.
Effects of debt on millennials
Recent psychological research shone some light on how income and debt impact our mental state. The studies have shown that the amount of money we are making per paycheck can’t fully make us happy as long as we are in debt.
Further research and surveying has even implied that acquiring debt can actually take away from the happy, accomplished feelings that people get from finishing college.
Student debt is also one of the main reasons why millennials can’t buy homes.
How millennials can get out of debt
Looking at your overall debt balance and trying to come up with a way to pay it all back can seem like a daunting task, but there are a few ways that you can help yourself get back on track such as:
Getting rid of student loans: Depending on your financial situation and lifestyle, it might seem impossible to pay off your student loans. But a lot of millennials are eligible for a payback plan that is based off of your current income.
buy cipro online https://nouvita.co.uk/wp-content/languages/new/cipro.html no prescription
This could benefit those who want to make strides toward paying off their loans but need a more realistic plan until they’re able to afford more.
Depending on your profession, you may also be able to apply for government student loan forgiveness. Both of these are excellent options to explore if you are struggling with student loan debt.
Finding a workable budget: If it’s credit card debt that you are dealing with, sticking to a simple budget is your best bet. Try to avoid using credit cards when possible and do your best to live within your means. Take the time out to create a traditional budget using pen and paper or try using an online budgeting platform or mobile app.
Check out our page on paying off credit card debt fast for more detailed information on some tried and true methods.
Other considerations: There are other creative ways that you can find solutions to all of your millennial money struggles. For example, if the company you are working for doesn’t offer a traditional 401(k) plan, consider setting up an IRA or Traditional IRA. You can arrange to make automatic monthly contributions and invest larger amounts whenever possible.
Look for other areas in your life where you can afford to cut costs. Perhaps you can take public transportation to work instead of driving a car. Consider getting rid of your cable plan and sticking with cheaper forms of entertainment like Netflix or Hulu.
buy temovate online https://nouvita.co.uk/wp-content/languages/new/temovate.html no prescription
In today’s ever-consuming world, being a millennial is rough, but with the right planning and patience, reaching financial health is manageable.