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For Debt-Laden Young Adults, Reality Bites At 28

While young adults may feel empowered by debt, they start to feel weighed down by it when they reach 28, according to a new study. The more credit-card and college loan debt shouldered by those aged 18 to 27, the more they felt in control of their lives, according to an Ohio State University study.


Rachel Dwyer, lead author of the study and assistant professor of sociology at Ohio State University, says of her rather disturbing findings, “Debt can be a good thing for young people — it can help them achieve goals that they couldn’t otherwise, like a college education.”

The study examined two kinds of debt: credit card and college debt. “Surprisingly, though, we found that both kinds of debt had positive effects for young people,” Dwyer says. “It didn’t matter the type of debt, it increased their self-esteem and sense of mastery.”

She offers this explanation: Young people may see all kinds of debt as a positive investment as they may use credit card debt to pay for their college text books. “Along with education spending, they could be using credit cards to pay for non-essential items,” Dwyer adds.

The more surprising (and scary) aspect of this study, which involved 3,079 young adults: By 28, young people are aware that they overestimated how much money they were going to earn. “When they took out the loans, they may have thought they would pay off their debts easily, and it is turning out that it is not as easy as they had hoped, ” Dwyer says.

To quote from “Friends,” the sitcom that defined a generation of twenty-somethings: “Welcome to the real world. It sucks.”

Do you think this study represents young adults?


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    • I partially agree with this article. As a 26 year old, I have always understood one fact, when you have debt you dont actually own your items, they are just borrowed. I recently purchased a new car and took out a 20K loan. That was last year. To date, 12 months later I have a remaining balance of 3K. Was I empowered to pay off my loan, 100% yes. Do I feel comfortable that my bank holds the title to my car, no. Same is true to student loans. Pay it all off ASAP!
      Its always interesting to me to read about educated individuals that are without work or recently lost employment and decide that they are better off going back to school for more education! Yea, 100K more in debt that cant be erased in chapter 11 bankruptcy.
      Long story short, get out of debt! Purchase a home and live below your means so you can pay off your 30 year mortgage in 20 years and not have to worry about what you owe, cause besides shelter and education what else do you really need that you cant acquire?

    • I’m not surprised that students feel empowered when they don’t have to pay the bills, and burdened once they finally do.

      Let’s face it, there are failures in long-term fiscal planning in every industry. Investing in a college education (or even graduate education) can and does pay off when done responsibly. When finding the best fit of a college for a particular student, financial aid needs to be one of (if not THE) top priority.

    • I am so glad that I did not have any loans. I did this despite having no government financial aid and no parent financial aid for either my undergraduate degree or Master’s. I worked my way through and it was the best thing for me to do.

    • Having just turned 29, I absolutely agree with this article. I was lucky in having my undergraduate education paid for by my parents good financial planning. I did manage to rack up nearly $8,000 in credit card debt by the time I entered my senior year of college. I took charge of that debt and had it paid down to less than $1,000 by the time I graduated. It was incredibly empowering.

      Unfortunealy it took me almost 2 years to find ‘gainful employment’ working at a small box retailer. The $6.50/hr + commission at my first ‘real job’ was nowhere near the $30-$40k jobs that I had been told that my education and experience would get me.

      It took going back to school to earn my Master’s degree (paid for by loans) and some very strong negotiation to finally get to a job that even came close to the pay range I had been planning on.

      During the last 4 years my debt combined with my wife’s has ballooned because our paychecks couldn’t keep up with the cost of gas, rent, food and medical costs.

      I have no complaints about the debt that I have accumulated and I understand the responsibilities that I have to repay those debts. Our debt has allowed us to have the satisfaction of not being dependent on our parents, but it is only recently that we have begun to see how it limits our ability to build our own family.

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