The new generation of college graduates is unlike any that have come before them. While parents and grandparents of these children would not have dreamed of graduating with credit card and student loan debt, this generation is making its mark in its own way. The average college student now graduates with a debt of $24,000 in student loans and credit card debt. This is a 25% increase in debt over those that graduated just a few short years ago in 2004. Couple this with the fact that the country is experiencing the highest unemployment rate seen in decades and graduates face challenges never experienced before.
Consumer Financial Protection Bureau to the Rescue
One of the first steps in changing these situations is to reach students before they find themselves swimming in this amount of debt. The Consumer Financial Protection Bureau has announced that it is offering resources and tools to teach college students about how to manage debt. The information includes how to make financially sound decisions on credit such as establishing and using credit cards and obtaining and using student loans.
Face the Facts and Make a Plan
If you happen to be one of those recent college graduates that are already in debt, then the newly established services are not going to be of much assistance to you. Hope is not lost, however. You still have tools and resources available to you to dig yourself out of debt. The first step of making this happen is to face your debt head on. Pull out all of your credit card statements, loan promissory notes and other loans you may have and tally it all up. The big mistake that most make is to avoid facing the debt, which also paralyzes them in overcoming it.
Coming to a realization about the amount of debt you’re in and making a plan to get out of it propels you toward reaching your goal. Even if your first job out of college pays you less money than the amount of debt you have racked up, learning how to live within your means so that you can pay off your debt is the key. Even with a $40,000 per year job, you should have enough to pay your bills and set a little money aside in a savings or retirement account.
In order to be able to do this, however, you may have to sacrifice your daily trips to the coffee house to sip cappuccinos while socializing with friends. It means that you have to wait to lease your dream car until you can afford to pay for it and you have dug yourself out of debt.
Generations to Come
While generations to come may have the tools, knowledge and resources from the Consumer Financial Protection Bureau, past generations may have to use their own tools and resources to dig out of debt. As a parent or current college student, use the information provided by the Consumer Financial Protection Bureau, banks and other financial institutions to learn how to be financially responsible adults or to help mold your children into these adults for tomorrow.