-
The Spectator’s Spectacular: May 18-May 25
May 25, 2013 | 0 comments
-
Stein on IRS Scandal
May 24, 2013 | 6 comments
-
Morning Round-Up 5-23
May 23, 2013 | 0 comments
-
Anthony Weiner’s Campaign Video
May 22, 2013 | 3 comments
-
Moore, OK by Steve Breen
May 22, 2013 | 0 comments
The Spectacle Blog
It seems that the young have grown as cautious as the elderly with debt:
Young adults are cutting debt faster than older people and are less in hock to creditors than a decade ago–despite the ballooning of student loans, a new study shows.
Between 2001 and 2010, young households—defined as those headed by someone younger than 35—have generally reduced their indebtedness while older households have increased it, according to a report by the Pew Research Center released Thursday. Some 56% of young households saw either a decline or stabilization in their overall debt load in the period, with only one type of debt—student loans—rising as a share of total debt. By contrast, older households tended to have more non-property-related debt than before, not less.
Neil Shah at The Wall Street Journal explains that this is due to a variety of factors, including reduced overall mortgages, auto loans, and credit card debt.
Specifically, younger people are getting married later, which means they do not form households until they are older.
As for automobiles, only 66% of young households owned cars in 2011.
The post compares the present day to the 1980s, when younger households held more debt than older ones:
The typical young-adult household owed around $15,000 in 2010, half the $30,000 owed by older households. That’s a striking reversal from 1983, when young households owed more than older counterparts.
Of course, the 1980s saw roaring growth of real consumption and GDP per person, producing such categories as the “yuppie,” the Young Urban Professional.
While I think it is responsible for the United States to reduce its overall debt load, I grow concerned about future income growth for young households.
Let us hope that this does not mean a general adversity to risk for those under 35. It is they who must help reform our government in the future; they certainly have a hardy task ahead.
View all comments (5) | Leave a comment
More Blog Posts by Patrick Ryan
http://spectator.org/blog/2013/02/22/the-young-and-the-cautious
Follow us:
ADVERTISEMENT
SPONSORED LINKS
FLASHBACK TO: 1995
-
Pope Culture
A man of faith in a godless age is hitting Americans where it hurts.
-
Why the GOP Does Not, Like, Totally Suck
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
-
Dames at Sea
-
In the Absence of Guns
In Britain, defending your property can get you life.
-
The Metaphysical Martini
-
Counting the Costs of Clintonism
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
-
Chuck McHagel
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
-
The Legacy of Old John and Mother Fresh-Roasted
-
It’s the Best Time of the Year
The American Christmas, like the songs that celebrate it, makes room for everybody under the rainbow. Is that why so many people seem to be hostile to it?
-
The Bush Crack-Up
Was the President done in by the economy, or by the politics of the economy?
Clip of the Day
H/T to National Review Online
ADVERTISEMENT
RJ| 2.22.13 @ 3:58PM
Thanks for the good news about young people cutting down on debt. It is a lesson best learned early in life; something which many baby boomers failed to grasp.
JD| 2.22.13 @ 6:12PM
Can we trust these numbers when they measure "household" rather than individual debt? No, we cannot.
Measuring by nebulous "households" is one of many tricks used by Leftists to distort numbers, since the size of household changes over time, and not in intuitive ways.
Sue DeNym| 2.23.13 @ 12:39AM
Absolutely correct. Using household instead of individual income numbers can be extremely misleading. A single household with three people making a combined $100,000 a year has a household income of just that, $100,000. If two members whose combined income is $50,000 move out and set up a second household, suddenly household income just dropped to $50,000 per household with little change in real circumstances, but apparently a huge economic downturn has occurred. If the two then move back in to the original household, suddenly household income shoots back up to $100,000. Actual improvement in individual income can look like a decrease in household income if new households are established because people can now afford to move out and live in their own place.
C Bowen | 2.22.13 @ 6:25PM
"While I think it is responsible for the United States to reduce its overall debt load, I grow concerned about future income growth for young households."
It seems the authors links debt with wealth, like a good Keynesian. That is all well and good and popular with the educated class, but the author should attempt to do better, this being a conservative site.
Stan Redmond| 2.24.13 @ 7:02PM
They left out the plummeting birth rate for married couples.
Think how bad it would be if we weren't subsidizing single motherhood. Debt woul be through the roof if unmarried young mothers had to pay their own bills.