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The world does not stand still, but moves and changes. And people are changing together with the world. They change their behavior and attitude to different things. People of different generations have different attitude to money, their accumulation and their spending: and also they have different attitude to the debt. So, what generation has the highest debt?
Some people are okay about living in debts, some of them are totally against it. Why are their opinions so different? Such difference in perceiving of the notion of debt can occur because of the different lifestyle and different outlook, but in fact this difference may occur because of the age gap between them.
The research conducted by 2017 showed us the attitude of different generations to their debts and answered the question “which generation has the highest debt”.
What do people born between 1961 -1996 think of their credit card debt?
People who were born from 1961 to 1996 are usually divided into three generations: Generation Z, Generation Y and Generation X. The research found out that these people use their credit cards in comparison with the other generations less often. The study proved that people who belong to the Generation Z spend less money than the others. An average debt of this generation is about 630 dollars. The debt of the generation Y and X does not exceed 660 dollars.
Now many people from these generations leave their parents’ homes to buy their own. And this is the reason why their mortgage debt is the highest in comparison with other generations. It is more than 230 000 dollars.
What is the debt of Baby Boomers? (People who were born after WWII)
An average credit card debt of a Baby Boomer is about 700 dollars that is just a little bit higher than the debt of a person belonging to previous generation. Although, these people are in a very good financial shape, their mortgage debt cannot be called the lowest, it is about 190 000 dollars.
Such mortgage debt may be the cause why many Baby Boomers have no retirement savings. The research of 2016 showed that three people out of ten are not able to save money for the retirement.
The attitude of the Silent Generation to their card debt (from 65 and older)
Silent generation has the highest credit card debt among the other generations. Their average debt is around 730 dollars. And their mortgage debt is also surprisingly high: about 157 000 dollars.
The research of 2015, though, found out that this generation is the most responsible. It is said that 72 per cent of people who belong to this generation usually pay their debts each month.
But not many people pay their credit card debts each month. Many of them do not pay their debts off even in some months and wait until the sum they have to pay is “high enough”.
In the situation when you cannot manage to pay your card debt you have to follow some important tips:
- Track down your money. If you have a constant credit card debt it is obvious that you spend more than you make and in this situation you have to find out what you actually spend your money for. Install a special app on your phone that would show you the list of things you buy or just write down them in your notebook. And then you will see what the reason of your excessive expenditures is.
- Cut your expenses. The next step is to get rid of your expenses to free up more money for debt repayment.
People belonging to different generations are accustomed to different ways of spending their money. They have different attitudes to their debts and their repayment. But every generation should remember that it is important not to spend more than you can afford, more than you earn. Because in this situation you would not have to think of your debt and how to pay it off, and, also, you would be able to save some money “on a rainy day”.