Debt Struggles Facing Millennials | Richard Banks & Associates, P.C.

One of the most pressing issues millennials are currently dealing with is a skyrocketing amount of debt, much of which comes from student loans.

With $1 trillion in debt weighing down the financial situation of millennials, there are plenty of struggles those born between 1981 and 1996 are facing head-on.

How Student Loan Debt Is Impacting Millennials

Did you know that more than 60% of millennials believe that they will never be able to pay off the debts they owe? Of that number, 42% don’t know when they’ll be able to wipe out debt and 20% expect to die in debt.

With higher than average student loan debt weighing down on those born between 1981 and 1996, traditional “rite of passage” purchases are being delayed.

Not only are millennials not buying homes at a high rate, but they are also slower to marry and have children than past generations. According to the Urban Institute, millennials currently have a homeownership rate of 32.2%, while Gen Xers are at 60.4% and Baby Boomers are at 75%.

The Good Side

Despite the staggering amount of debt that has been racked up by millennials, it is important to note that the generation is actually better off than the Gen Xers.

Millennials have been noted to be more conservative with their money, which is shown by the type of debt being carried. Student loans, by far, are where millennials carry the most debt, but those ages 18–39 tend to have a lower amount of credit card debt than other generations.

The millennials are also doing a better job at saving than other generations, especially the Gen Xers. While that earlier generation has a higher net worth, it is the millennials who are ahead in retirement savings at $15.5k to $13.6k.

While those in the millennial generation may be delaying some of life’s milestones, they are also taking positive steps toward a better financial future. The “snowball method” is one debt management method being using by this group with much success. By cutting back on other expenses, they are able to take a chunk out of their debt—and in some cases, become debt-free.

The debt issues facing millennials are common fodder for the news, but it is important to remember that it’s not all doom and gloom. For those of this generation who are struggling with debts outside of student loans, the bankruptcy professionals at Richard Banks & Associates are ready and waiting to offer expertise and help at righting the financial ship.