This piece on The New York Times’ Bucks blog caught my attention the other day: “Debt has become a way of life for American college students. The average student loan debt among graduating college seniors was more than $23,000 in 2008, according to FinAid.org. In addition, the student lender Sallie Mae says the average graduating senior with at least one credit card had $4,138 in debt on the card.
Yet, instead of feeling stressed about owing all that money, many students actually feel “empowered,” says a new study from Ohio State University, based on data collected for the federal Bureau of labour Statistics. The study, published in the journal Social Science Research, surveyed 3,079 students, the majority of whom were in their early- to mid-20s.”
OK, as the self-proclaimed king of credit card reviews and personal finance blogging, two thoughts immediately come to mind:
1) Studies like this are notoriously flawed. Is ’empowered’ a scientific, psychologically valid state of mind? Is it in the DSM-IV? Because it should be; these college kids aren’t empowered, they are delusional. Also, they think the debt is OK because, hey, after you graduate you are guaranteed a six-figure job at a company that respects you and will look out for you. That was true 30 or 40 years ago in America, at some companies — it’s not true today.
2) Of course you feel good when you first take on debt! Follow up with these college kids 10 years from today… ask them if the private school education, MacBook Air, and spring break trip to Cancun was worth abandoning your dream to take a menial day job and pay down those crushing high-interest debts.
Debt is never depressing when it’s first taken on — you get to see the rewards right away… The new car, the brand-name education, the apartment or house.
It’s only years later that you regret it. (This coming from someone who, at one point, had far more than $23,000 of debt… and paid it all off.)
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