A personal finance web log published by the New YorkTimes discusses a recent survey which suggests youngerconsumers are carrying more debt and taking long to pay it off thandid previous generations at the same age and suggests that financial education efforts may need to be heightened.
|The survey, conducted by Lucia Dunn, an economics professor atOhio State University, and Sarah Jiang, a credit card executive,and published in a peer-reviewed economic journal, found thatsomeone born from 1980 to 1984 has credit card debt substantiallyhigher than debt held by the previous two generations.
|The research found that, on average, the young person carrieddebt about $5,000 more than his or her parents at the same stage oflife, and about $8,000 more than his or her grandparents.
|The researchers cited several reasons for the phenomenon,including the increased availability of credit and a relaxation ofsocial stigma surrounding debt and bankruptcy. “It's a lot more socially acceptable to have debtand go into bankruptcy,” Dunn said.
|The survey said that younger people are paying off their debtmore slowly. The study estimated that the younger borrowers' payoffrate is 24 percentage points lower than their parents' and about 77percentage points lower than their grandparents' rate.
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