Millennials are no more kids!
*This is a guest post by Andy Masaki.
Their average age has now reached the mid-20s. They are adults now and are ready to take up big responsibilities.
But there’s one problem that’s hindering the economic growth of millennials. The problem is none other than debts.
In recent times, the overall US debt is huge, and a major percentage of that debt amount is carried by millennials.
Why so? Is it the credit cards?
Or some millennials are starting to take out mortgages and other security backed loans at an early age?
Or is it their maturity going towards a wrong direction?
Nonetheless, as time progresses, we humans civilize, and it is confusing and disheartening to see, our youth crumbling down under huge debts and misleading ethics!!
I believe, it’s high time we should figure out,
Why millennial debt is increasing day by day:
Are credit cards and other consumer debts taking their toll?
Millennials are highly prone to credit card debt. The “easy come easy go” money philosophy they hold onto is really making a catastrophic effect.
Credit cards are like an addiction. The feeling of you can get whatever you want, right now, by swiping a card, is splendid!!
Millennials believe the gateway to accomplishing dreams is invariably the credit cards. But these young adults are barely aware that ultimately they will pay more for each purchase they initiate with a credit card.
Of all credit card users, millennials make up the most irresponsible percentage. Moreover, millennials seem to never understand that there is something called interest, which they have to pay if they are taking out any type of credit!
Credit cards carry a notable rate of interest, that only grows over time as a penalty when the balance is left unpaid.
It’s simple to understand, but the millennials seem to be too ignorant to pay attention to all these valuable teachings.
Is it the millennial lifestyle to blame?
So, should we blame their parents, the Generation X, who led the hippie counter-culture life and forgot to give proper money education to their children?
Or is it the millennials to blame, the arrogant, high self-esteemed, pop generation?
Let’s understand some other important aspects here:
Divorce rates have increased successively since the era of Generation X and onto adult millennials!
Plus substance abuse has increased among millennial young adults, followed by a corrupted life image of anger and anxiety.
If you think that relationship issues, family distress, and psychological disorders don’t impact an individual’s financial standing, then you are wrong to the fullest!
Managing finances requires a calm mind, and if a person is lacking that, then debt problems are bound to arise.
Hence, it’s a solid suggestion for millennials:
They should not support relationship breakups, rather know how to be together, and merge finances being a couple!
And, internet influence should be minimized, along with fancy status competition among peer groups in both reality and social networks!!
Are millennials not able to manage student loans and secured loans?
The highest student loan debt is right now carried by the millennials, and many such loans are cosigned by their parents, who belong to the Generation X!
Student loans are inevitably one of the hardest to pay off. They are not easily forgiven, and they are like sticky gelatins! Also, only a few consolidation companies can help you to clear a student loan. Actually, millennials are starting to take everything for granted. A certain number of them understand the gravity of taking a student loan, for college and university! Most of them forget the fact that they are carrying a hefty amount on their back, in a rush for momentary happiness and to show off or maintain a pseudo status, once they are in college!
Now let’s focus on another important factor. Millennials are now adults, and they have their own dreams of owning a house, and a car!
To accomplish such dreams they will have to take out mortgages and auto loans! And, that’s where many millennials fall into the big trap of debts.
They frequently change jobs, and many don’t have a fixed income, which forces them to have such huge amounts of debts!
Or is it that millennials don’t know how to pay off debts?
Paying off debts is practically pretty easy, where all you have to do, is plan on your expenses as per your debt payment obligations! Clear as water.
Hear up millennials, here’s a little example for you all!
Say your monthly income is about $5000, expenses is somewhere around $3000, and you do a savings of $2000!
But you now have to make some credit card debt payments of somewhat $500 per month.
So what will you do?
Should this $500, be included as a part of your $3000 expenses? Or should that $500 be deducted from savings where the equation becomes $3500 expenses, and $1500 savings, per month?
Be sensible, keep your savings intact, try to save more each day on expenses, and manipulate your expenses. Never ever compromise savings!
Also, take help of financial advisors and credit counseling companies to understand what various debt relief options you have to eliminate the millennial debt accusation!
But, but, but, this is not the end! It’s time for millennials to become the leaders and teachers!
Another generation is booming.
If millennials don’t hold the rail right now, then this upcoming generation, the Generation Z as they call it, the post-millennial generation, will be impacted with more debts!
Way – waaay more debts than what millennials are facing today.
Author Bio: Andy Masaki is a financial writer and blogger who specializes in the topic of debt. He frequently writes for the Oak View Law Group and an active member of several online forums where he shares his tips on how to lead a financially independent life.
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