We’ve all heard plenty about the student loan debt crisis, but millennials’ financials are being worn down by several forms of debt.
The average millennial is in debt and relying on their parents for financial assistance. This is in large part due to millennial student loan debt, but millennials are also racking up auto loan debt, personal loan debt, and credit card debt. According to a recent study by CompareCards, millennials are even going into credit card debt over their football passions. Out of all of these factors, the most overlooked, and one of the most significant, is millennial personal loan debt.
Personal loans are used for most personal financing needs that don’t have their own categories. They are used to fund most personal expenses that aren’t homes, cars, payday funds, or debt consolidation. American debt for personal loans is valued at over $125 billion and Americans under 35 account for 25% of personal loans borrowed in 2018, according to CNBC. Millennials are taking these loans out for a variety of purposes, with the most common being emergencies and important events like weddings.
The trend of taking on high loan balances is not unique to millennials. Americans from all walks of like are taking out larger personal loan balances, but it’s millennials who are already struggling with student loan and credit card debt. This personal loan debt is an added financial burden on the generation that got the short end of the stick with tuition. Millennials want to buy a home about as much as previous generations, but debt is the primary factor keeping them from achieving home ownership, among other things.