Young Adults Retreat From Piling Up Debt

[Dave_Berry]

<p>"Young people are racking up larger amounts of student debt than ever before, but fresh data suggest they are becoming warier of borrowing in general: Total debt among young adults dropped in the last decade to the lowest level in 15 years." ...</p>

<p>Sort of good news. They must be watching CNBC.</p>

<p>Young</a> Adults Retreat From Piling Up Debt - WSJ.com</p>

[Erin_s_Dad]

<p>

A typical young U.S. household—defined as one led by someone under age 35—had $15,000 in total debt in 2010, down from $18,000 in 2001 and the lowest since 1995, according to a recent Pew Research Center report and government data. Total debt includes mortgage loans, credit cards, auto lending, student loans and other consumer borrowing.

This really does point out that stories of students owing hundreds of thousands of dollars are very much statistical outliers.</p>

[texaspg]

<p>“Sort of good news. They must be watching CNBC.”</p>

<p>I thought they are all reading CC threads and deciding on economic options! :D</p>

[cptofthehouse]

<p>Try to get a mortgage these days or a credit card with a large allowable amount. That just might have some impact on the amount of loans people can get these days.</p>

[DougBetsy]

<p>Not all young adults got the memo. </p>

<p>A family friend was just overheard rejoicing that her son graduated from Fairliegh Dickinson with “only $80,000 in debt.” It could have been more, but he was on a athletic scholarship. The alternative to FD was a scholarship at the local directional U.</p>

[Erin_s_Dad]

<p>I could never see attending Fairly Ridiculous for that amount (said with fondness as a former NJ resident).</p>

[aquamarinesea]

<p>Here’s the link to the story for those of you who don’t have a WSJ account:</p>

<p>[Young</a> Adults Retreat From Piling Up Debt - WSJ.com](<a href=“http://online.wsj.com/article/SB10001424127887323293704578334761823150672.html]Young”>http://online.wsj.com/article/SB10001424127887323293704578334761823150672.html)</p>

<p>

The lower overall debt comes despite an increase in student borrowing, which ballooned to $966 billion last year from $253 billion at the end of 2003, according to the Federal Reserve. The percentage of people delinquent on their student loans is also up.

</p>

<p>I believe we are seeing lower overall debt in young adults (those 35 and younger) due to the recession. As cpt pointed out, it is now harder to get approved for a mortgage loan which is the largest source of consumer debt. Those who graduate with high student debt are having a harder time finding other forms of credit. </p>

<p>Good news is that young people are now saving at a higher rate than any other age group. The savings rate for those under 35 was -15% in 2006 and went up to over 5% in 2010.</p>