What would you be willing to give up to be debt free? Almost half of 18-34 year-olds (aka millennials) may be willing to give up the ultimate civic right, the right to vote.
Forget about American blood shed to free our fledgling nation from the thumb of the British Empire or the sacrifices made to give blacks and women the right to vote. Nearly half of millennials surveyed say they would give up the right to vote in the next two presidential elections in order to have their student debt forgiven.
New survey results from Credible, a personal finance website, give us a glimpse into the desperation of a generation saddled with education debt.
Millennials are willing to give up other conveniences and freedoms as well:
- 43.6 percent would give up ride-sharing services such as Uber or Lyft forever
- 42.4 percent would give up travelling abroad for five years
- Only 27 percent would be willing to move in with parent for five years
- A slim 13.2 percent would be willing to give up texting (or any other form of messaging) for one year
- Just 8.2 percent would give up none of the above, but keep their student debt
The plight of millennials and their sluggishness to achieve generational milestones such as purchasing homes, getting married, and starting families is well documented. Student loan debt plays a notable role in this.
While median household incomes have started rising after stagnating during the recent economic recovery, the $1.3 trillion in federal student loans among 42 percent of Americans will continue to eat up income gains. That’s a good reason for Congress to pass tax reform that includes tax cuts and much-needed relief for Americans.
The question is what should we do going forward to freeze and reverse the upward trend of college costs? An IWF policy focus by Hadley Heath Manning provides some ideas.
We can start with turning off the spigot of federal funds from Washington to colleges and universities, which give them no incentive to control costs, and introduce the novel idea of accountability.
Currently, federal aid is provided to college to meet the educational needs of students without any responsibility for how the money is being used. As we know, administrative costs have ballooned in academia as have the costs to create a fun living environment on campuses which don’t have anything to do with academic studies.
Greater privatization and competition in higher education are important solutions. We have to allow students to pursue the best pathway for their individual career success rather than shoving every high school senior onto the four-year college road, which may not be the right course for a young woman or man.
Millennials took on debt thinking good-paying jobs awaited them after college. Now, they are stuck with the contractual agreement to repay loans for their education, but their salaries don’t match their outsized debt loads. Private-sector companies are offering debt-repayment incentives to attract good talent in a tightening job market and that’s a good thing.
We can’t let millennials off the hook though. If they are willing to give up the right to vote for the leader of our nation for eight years, but aren’t willing to give up texting and messaging for even one year or moving back in with parents to paydown debt, perhaps this is a generation with slightly misplaced priorities.