Gen Z has more debt than Millennials did at the same age
Money Management International reports a 35% rise in demand from Gen Z clients over the past year
(InvestigateTV) — Gen Z carries more debt than Millennials did at the same age, even after adjusting for inflation, according to TransUnion data cited by a credit counseling expert.
Ted Rossman, with nonprofit credit counseling agency Money Management International, said the agency has seen a 35% increase in demand from Gen Z clients in the past year. Their debt loads are about 12% higher than they were a year ago.
Student loans, high rents and buy now, pay later plans are adding up and leaving many young adults living paycheck to paycheck with little savings.
“That’s really showcasing a lot of these early career pressures,” Rossman said. “You have student loans, you have high housing costs. Those household formation years are very expensive, so GenZer’s actually have more debt than Millennials did at the same age, even adjusted for inflation according to TransUnion.”
For Gen Z, Rossman said the starting point is the basics: knowing your budget and watching buy now, pay later spending.
“It’s very popular among people in their 20’s, but it’s still debt,” Rossman said. “It can work in your favor. Sometimes you can get a good deal, but just be mindful that it’s not a free lunch. Even if it’s that 6 weeks of interest free payments you’ve got to make a payment now and another one in two weeks and another one in two weeks, just need to be careful that you’re not overspending.”
Rossman also cautioned about the interest owed on those deals and on credit card debt, which can often be in the 20% range.
Rossman said people who feel in too deep can always ask for help.
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