Are Millennials as broke as the media says they are? The answer is a resounding yes for the following reasons.
If you type in “characteristics of the Millennial generation†into trusty Google you will find a list of interesting headlines. Some of the titles given to Millennials are: Generation Y, Generation WE, The Boomerang Generation, and The Peter Pan Generation. Part of this stems from the way many were raised by baby boomers who were promising their kids the world. Many felt that leaving college with any degree would be enough for a high income and an avalanche of jobs hitting their email box. None of this really materialized. Unrealistically high expectations. Denmark, which typically ranks among the “happiest†countries in the world carries one interesting trait – have low expectations. In fact, most Millennials are struggling in the current economy. The Millennial generation leads the way in the amount of student debt it carries. Many are stuck in low wage jobs earning so little, they are living with their parents deep into adulthood. How broke are Millennials? Pretty broke when you look at the data.
The young carry the weight of student debt: Of the more than $1.3 trillion in student debt outstanding over 66 percent is carried by those 39 and younger.
The compounding problems with student debt are getting louder as each year passes by. Student debt outstanding is now at a whopping $1.3 trillion and most of this is being carried by young Americans. While college costs have soared for most many recent college graduates are working in jobs were wages are low. This has had the unwanted impact of causing student loan delinquencies to rise dramatically. Student debt is now the worst performing sector of loans in our economy. From the outside and inside this looks like a bubble but it is only continuing because the government and banks continue to guarantee loans. Yet momentum is going to catch up on this runaway train and delinquencies are the first cracks in the dam. The young now carry an incredibly heavy burden of debt simply because they went to college at a time when costs are out of control.
What the heck? U.S. Public Debt up $518 billion in November alone: U.S. debt ceiling made of toilet paper.
You might remember that back in March, we hit our debt ceiling limit. The amount registering on the U.S. Treasury Department website was stuck at roughly $18.15 trillion. Of course given our addiction to spending and debt, we simply charged all new spending off the books. We as a country have a deeply rooted addiction to debt. The government was using “extraordinary measures†to circumvent the debt ceiling even though we are supposedly in a big recovery. Eventually late in October, The Treasury decided to unwind this accounting mess and added the debt to “the books†for all to see. The public is currently overwhelmed with worldly events and the reality TV based election year. So in one day alone on November 2, total public debt soared by $340 billion. As a comparison, the GDP of Greece is roughly $242 billion for an entire year. In fact, since the start of November total public debt has increased by a mind blowing half a trillion dollars.
100 American CEOs have more retirement wealth than 116 million Americans. The retirement divide grows larger each year.
Most Americans have no retirement strategy. In fact, the new model of retirement appears to be work until you die. It isn’t an uncommon model. In fact, this used to be the status quo for centuries on end. Some tend to believe that having a middle class is the natural order of things. That is simply not true. The middle class needs to have an economic system that favors those that work hard instead of protecting a modern day corporatocracy where politicians simply protect those that pay them off. This is the new system in place. So it is no surprise that 100 American CEOs now have as much retirement wealth as 116 million Americans. It is no surprise then that many older Americans are going to rely on Social Security as their primary source of income into retirement. As you would expect in older age medical costs go up so the burden on Medicare will also rise. The retirement divide simply grows larger in this country.