Debt falling sharply among young people: Study
Young people these days are hesitant to use credit cards. (istock) Credit: Young people these days are hesitant to use credit cards. (istock)
The recession had a strong impact on young Americans who saw the credit crisis up close: they are taking on less credit card debt, delaying plans to buy homes and owning fewer cars, according to a study released Thursday.
From 2007 to 2010, the median debt of U.S. households headed by people age 35 and younger fell by 29% from $21,912 to $15,473 - while debt of older Americans fell by just 8%, to $30,070, according to the Pew Research Center study, "Young Adults After the Recession."
Residential property accounts for at least three-quarters of average American debt, so much of the drop may be connected to a decrease in home ownership. The number of Americans under 35 who own their primary residence dropped to 34% in 2011 from 40% in 2007, Pew said. Meanwhile, the percentage of homeowners over age 35 fell by 2 percentage points to 72%.
Young adults are cutting back on credit card usage as well.
Young households with credit card debt fell by 10 percentage points to 39% between 2007 and 2010.
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Out East Show: Visit The Shamrock evergreen maze, Sannino Vineyard, Seven Ponds Orchard and the Warrior Ranch Foundation NewsdayTV's Doug Geed is heading 'Out East' to showcase the ultimate local spots you need to explore.
