NEW YORK TIMES: …The Urban Institute study is one of many to show something of a perfect storm of economic trends battering younger workers. One is the collapse of the housing bubble. Young people who bought homes as prices started to decline in 2006 are often underwater on their mortgages today. But now that prices have fallen sharply and interest rates are remarkably low, many other young adults are locked out of the market because credit standards are tougher.
A second major trend is the rise of student loan debt, which has continued to grow through the recession, sometimes saddling students with burdens that extend into six figures and might take decades to pay down. A study of Federal Reserve data by the Pew Research Center found that 40 percent of relatively young households had outstanding student debt as of 2010, up from 34 percent in 2007. The median balance among all households with student loan debt was more than $13,000.
…Finally, and perhaps most important, younger workers have faced a brutal job market in the last half-decade. The unemployment rate is 7.8 percent for workers between the ages of 25 and 34; it hovered over 10 percent for more than a year during the recession and early stages of the recovery. For workers between the ages of 45 and 54, the unemployment rate is 5.5 percent, and it peaked at 8 percent in 2010… (more)
A second major trend is the rise of student loan debt, which has continued to grow through the recession, sometimes saddling students with burdens that extend into six figures and might take decades to pay down.
What’s worse is being an “adult” student. Those of us that have had to drop out of college due to finances or had to wait until we were well and truly considered independent by the government’s “standards” to apply for loans without taking our parents finances into consideration. But this leads to having to work full-time while going to school, which leads to being looked over for grants and scholarships because we are not right out of high school, nor are we sometimes considered “in need” of a grant. Sometimes, we are more in need than a high school graduate because we are full-time employees with other responsibilities that takes our money- but since the FAFSA goes strictly off how much income is ‘made’ through a taxable year, it figures that there is an expected amount of money we can pay towards our education and therefore our loans are sometimes lower.
The student loan situation of how it is determined what is given out to assist is as bad as the minimum wage situation. Neither take into account the high cost of living and other expenses involved in day to day life. Yet so many jobs require a Bachelor’s degree, minimum, in order to get any job that pays decently. So the student loan problems and the minimum wage problems seem to go hand in hand. We can’t win for losing.
There is simply no advantage you young people to build wealth given todays social support systems. This link sets it straight with data from the PA dept of welfare. We can connect dots too.