If you’re over 30 and struggling with debt, your mortgage, or unemployment, you should seek help. If you’re in your 20s, though, you should suck it up. Your financial woes are all in your head.
That’s the thrust of Kimberly Palmer's argument in U.S. News. In "A Financial Roadmap," she suggests that young people’s difficult financial situations are really just a matter of perspective. As she's said before, young people’s high hopes create despair.”
Palmer suggests that young people should adjust “overblown expectations” (like wanting to own a home before having children), “steer clear of debt,” and “appreciate what you have” to mitigate financial struggles.
Aside from that being poor advice, her view of young people is too narrow. As I wrote last week of “generation gurus,” the conversation is again focused on the upper-middle class, not on the majority of young people who are truly struggling. Certainly, there are young people who graduated from college expecting to own a home immediately and lead lives of unrestricted opulence. But then there’s everyone else. On average, young people carry $28,000 of student debt and $5,500 of credit-card debt. They also have the highest unemployment rate of any age group (nearly 20 percent in some estimates) and the second-highest rate of bankruptcy.
Young people need help. Here are two pieces of the real financial roadmap that can help millennials struggling with finances:
- Financial education: Only three states require dedicated financial education courses for high school students. According to a report on young people’s debt by Demos, 96 percent of college students have credit cards -- and many get them when still in high school. Credit card "bills of rights" and loan repayment programs are of little use if no one knows how to take advantage of them.
- Reforming college costs: The recent expansion of Pell grants and the introduction of income-based loan repayment are steps in the right direction, but they’re not enough. Loan reforms, grant expansions, and tuition reduction are necessary to help students get the cost of higher education back under control.
--Christopher Sopher
