Since the end of the recession, consumers of all ages have made significant progress in trying to get out from under the debts they held for long periods of time, but none have been more successful in this regard than those between the ages of 18 and 29 years old.
Some of our readers may have missed our post from September 2012 in which we showed that far from being used for their generally accepted purpose, student loans - now well over $1 trillion and more than the total credit card debt outstanding - in numerous instances are instead abused to fund virtually everything else besides paying for tuition. Recall: "Robert Thomas Price Jr. borrowed about $105,000 for his tuition at Harrisburg Area Community College from 2005 and 2007, federal authorities say.
When Deacon Hayes and his wife Kim sat down to discuss their finances, the newlyweds discovered they had $52,000 in debt, including $18,000 in car loans, $27,000 in students loans, and $7,000 in outstanding credit card balances.
The price for an education has been rising rapidly while the value of that same education seems to be diminishing. Underemployment is an epidemic in the U.S. and traditional career paths are becoming more and more competitive. This has resulted in a student debt bubble in the U.S. that the model that Hyman Minsky developed to analyze financial bubbles. The 4 phases are the systematic development of financial fragility, the movement to the brink of financial crisis, the disruption of stability by a surprise event and Debt-Deflation.
Ashley Peterson Photography/Bruce Bentley/FlickrSaying "I do" is more than just a commitment to share your life with someone, it's also a pact to share your finances. Once you walk down the aisle, every money-minded decision you make — from saving for retirement to going out to lunch — affects your partner as well.