Thoughts on “The Broke Generation” February 8, 2006
There’s an article that interviews Tamara Draut, the author of Strapped : Why America’s 20- and 30-Somethings Can’t Get Ahead about why people in their 20s and 30s feel that they can never get ahead with their finances.
Draut claims the gloomy conditions have less to do with extravagant spending habits and more to do with skyrocketing housing prices, college tuition increases, credit card debt, depressed wages and increasing health costs.
I have to agree that although there are lots of 20 and 30 year olds who are “Lazy. Spoiled. Irresponsible,” there are many who just can’t get ahead due to rising housing prices, tuition, and gas prices. For those who are doing everything they can by saving and paying down debt, things will get better. Paying down $200 here and there every month doesn’t seem to make a dent on your credit card balance, but with discipline, the debt goes away. The 20s and 30s is a period of self investment and sometimes that means a big investment in university and graduate school, so getting to the next income bracket is not in the forefront of their thoughts.
update (2/9/06):
MSNBC’s article from 2/8/06 also discussees the Broke Generation, or ‘Generation Debt’. One stat that grabbed me is:
Between 1983 and 2001, credit card debt for 25-to-34 year-olds nearly tripled, according to the Federal Reserve, from $3,989 to $12,000.
$12,000! I had credit card debt after college for $5000 and I thought I was never going to pay it off. But $12,000 is pretty steep, given that many first college graduates don’t make too much more than that. Draut talks about selling her CD collection to pay off her loans, but nowadays, college students don’t have a CD collection to sell, since they’re downloading their mp3 music onto their iPod.
- Posted in : Debt, Income Gap, Poverty
- Author : Kyle
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