This was a wise old farmer. Most large fortunes are also lost by the third generation. It takes a rare family to really instill the same knowledge and values through several generations.
Generation Y and Z Debt
- Thread starter Bobber
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This was a wise old farmer. Most large fortunes are also lost by the third generation. It takes a rare family to really instill the same knowledge and values through several generations.
I paid about $8k extra to ISU due to a "victory lap" caused from accomplishing next to nothing my freshman year in the dorms.
... And you're damn right I would do it again.
... And you're damn right I would do it again.
I think there are probably six factors, thinking through it.
(no particular order here)
1. Baumol's cost disease -- This is an old problem in economics. Service industries are not becoming more productive very quickly. It takes as long to grade an essay now as it did in 1950. At the same time, other sectors are seeing massive productivity increases and able to pay higher and higher wages. In order to attract workers, service industries have to do the same thing, which inevitably leads to higher prices because they do not have the productivity increases to hold them down. The same issue happens with healthcare with its costs over time.
2. Universities used to be faculty and... that was it. The mass professionalization and bureaucratization of educational institutions comes with its conveniences but costs, too, as well as state- and self-imposed mandates for certain service programs.
3. Students expect more -- the monastic experience used to be part of the deal, especially when parents were mostly paying for school. As students have started to self-finance, they have started asking for more, and hence dorms have become nicer.
4. IT costs -- computers and electronics for students and, perhaps underrated, the costs of equipment for faculty have gone up a lot. That has to be paid for. I would imagine research professors in engineering, sciences, and agriculture need a lot of $$$.
5. As the returns of a degree for individuals have gone up, so has willingness to pay. Their ability to finance more and more debt allows more to be charged. Colleges are simply collecting some of the windfall of the students' future wages and ability to finance for themselves.
6. State contributions to public schools have declined.
I think they all probably play a part.
L
LincolnWay187
Guest
I'm also a millennial. I don't know who's more irresponsible, the kid relying on his parents at 27 or the parents who keep coddling them. I personally don't know anyone who does this by the way.
Oh good, more Boomers to say how they paid $13 for college and young people these days just expect new phones every 60 days and that's why they can't buy a house
I work with alot of Boomers and I'm convinced their view on money is no "better" than Gen Y or Z. I can't tell you how many clients I have that have amassed large estates and have enjoyed absolutely zero of their money. No vacations, junk cars, same small house. Saving money just to save.
While I don't think taking on an irresponsible large debt load is a great idea either, there is something to be said for enjoying your money while living.
Bingo. The states have realized that the students are just going to take up loans to make up for what they are not going to pay for out of state tax dollars. Shifting the burden onto a much smaller portion of the population.
Do you just project every negative thought that you feel onto "right wing"ers?
I know this probably isn't a popular opinion on an ISU forum but I did my last couple of years taking night classes while working full time and it worked out great. This was a business degree so a lot of the other students were older and actually knew something about business. If I had to do it all over again, I would do all 4 years this way. I missed out on the sports, partying, etc. that comes with being a student on campus but I was in a lot better position at 22 both financially and work experience.
I do and they are both at fault but at some point I put most of it on the parents. In my case they see it as they are just helping them out and to fulfill their dreams blah blah blah. Meanwhile the rest of us see it as immaturity.
I see nothing wrong with moving back in with family if you are unable to support yourself BUT there MUST be a plan for how that is going to change.
Over the last 25 years states have drastically reduced funding to state universities and of course that cost has shifted directly to students. Furthermore, the fact that wages/income have remained pretty stagnant during that same time period. And Republicans blame the students and the professors instead of doing a little self reflecting on the damage their own policies have caused.
It might be different for others, but I would say at college graduation.
We helped my son through ISU (just graduated), in large part because he worked his butt off, he found a good job, and is now debt free and not relying on us any more (although he has asked if he can stay on our cell phone plan and reimburse us for it
)It has been interesting to mentor him on his personal finances: tracking his expenses and income, investing in 401K, paying for new tires, debating when to get a newer car, etc.
For sure, he is learning as he goes. But he is not sucked into a lifestyle (yet) and is trying to be responsible with his finances and avoid unnecessary debt..
Its not complicated. Everything costs more and wages are flat. Millennials have gone into extreme debt to make up the difference. At some point it will become unsustainable and the economy will crash. Then we will get another round of boomers and gen Z blaming Millennials. I guess its our fault no matter what
Its not complicated. Everything costs more and wages are flat. Millennials have gone into extreme debt to make up the difference. At some point it will become unsustainable and the economy will crash. Then we will get another round of boomers and gen Z blaming Millennials. I guess its our fault no matter what
Disagree wages are flat...
Wage growth has been outpaced by cost of living for decades. Multiple studies have shown this.
Couple of things.
I would consider quite a bit of student lending "predatory". Think about it. How easy was it to get $$ to continue your education? About as easy as it was to get a home loan for 125% of the appraised (read artificially "inflated" home value) prior to the housing bubble bursting (which if allowed to continue on unchecked, I could see a similar bubble burst with the student loans).
When it is that easy, of course bad decisions (i.e."investments") are going to be made. They way I recall, I filled out a couple of forms (some online) and the money was in my account PDQ. At no point did anyone question or ask what I was going to do with the money or anything. I know quite a few friends that went on vacations with this money, bought cars, the newest gadgets, you name it. Should we be shocked that a somewhat maturing teenager / early 20's student made bad decisions when handed access to more cash than most have seen at one time? Bad decisions could be categorized in the trinkets that they purchased or the B.S. in Underwater Basket Weaving funded 100% by student loans. Either way resources are squandered.
There needs to be checks with the balances. In order to get the $$, Johnny / Suzy should need to prepare a business plan on what they are pursuing, what the payoff is, and what the return would be for the lender. No different than it is in business.
If Johnny / Suzy don't know what they want to do with their lives, that is fine. I suggest some sage advice that I followed (although I didn't realize it at the time).....work and serve until you identify what you want to do / what you are good at.
I would consider quite a bit of student lending "predatory". Think about it. How easy was it to get $$ to continue your education? About as easy as it was to get a home loan for 125% of the appraised (read artificially "inflated" home value) prior to the housing bubble bursting (which if allowed to continue on unchecked, I could see a similar bubble burst with the student loans).
When it is that easy, of course bad decisions (i.e."investments") are going to be made. They way I recall, I filled out a couple of forms (some online) and the money was in my account PDQ. At no point did anyone question or ask what I was going to do with the money or anything. I know quite a few friends that went on vacations with this money, bought cars, the newest gadgets, you name it. Should we be shocked that a somewhat maturing teenager / early 20's student made bad decisions when handed access to more cash than most have seen at one time? Bad decisions could be categorized in the trinkets that they purchased or the B.S. in Underwater Basket Weaving funded 100% by student loans. Either way resources are squandered.
There needs to be checks with the balances. In order to get the $$, Johnny / Suzy should need to prepare a business plan on what they are pursuing, what the payoff is, and what the return would be for the lender. No different than it is in business.
If Johnny / Suzy don't know what they want to do with their lives, that is fine. I suggest some sage advice that I followed (although I didn't realize it at the time).....work and serve until you identify what you want to do / what you are good at.
I honestly didn't know this was a "thing". I thought it was just moving onto a different stage of life and these were many of things it entailed... I actually thought that was all the pay-off to getting out of school but I generally looked at school as, well, school so I could get a job and be an adult.
I'm 55 so I should probably say "get off my lawn or I'll report you to the HOA"...
Actually it's more about the getting into debt question in the first place than a wage question.
I can also assure you graduates are making considerably more than I did when I got out of ISU....
It has already been said, but JUCO and working is a perfectly fine strategy for getting your degree. No reason why you can't be a full time student and have a full time job (or multiple part time jobs). Honestly that (trying to juggle it all) taught me as much, if not more, than anything I learned in college.
When GT Jr. goes off to school, I anticipate him going JUCO route and living at home while he is doing so. His first semester may be a gimme. Successive semester funding will be determined by how he performs in the prior semester. Having and maintaining employment through this will also be a requirement. I like to think of it as a contractual agreement where he has some skin in the game. If he wants it bad enough, he will figure it out.
When GT Jr. goes off to school, I anticipate him going JUCO route and living at home while he is doing so. His first semester may be a gimme. Successive semester funding will be determined by how he performs in the prior semester. Having and maintaining employment through this will also be a requirement. I like to think of it as a contractual agreement where he has some skin in the game. If he wants it bad enough, he will figure it out.
