Entries from April 2008
A coalition headed up by the Institute for American Values confronts the debt culture in America, and is working to re-infuse the value of “thrift” in the United States. From the website of “For A New Thrift“:
WE ARE SEEKING COLLEAGUES for a national campaign to confront the linked problems of high rates of personal and societal debt, low savings, and growing inequality. In this campaign, we will propose initiatives for a new thrift culture that can provide competitive alternatives to the current debt culture.
Overindebtedness has become an American way of life. The national debt has ballooned in recent years, the savings rate currently stands below zero, and roughly 2 million more Americans are likely to lose their homes in the coming year. In addition, many families are carrying high balances on a fistful of credit cards, raiding equity in their homes to pay for short-term wants and needs, and putting their faith in the lottery as the only way out of debt.
Categories: media and culture
That’s the question that has walletwatch stumped, despite being a member of Gen Y himself.
For example, when a member of Gen Y is running short of cash between paydays, where does (s)he turn to for the best advice on where to get a loan? Or when its time to buy a car? Or buy a house? Or what is the best credit card to choose?
Our country does a pretty poor job of financial education in general. Wouldn’t it be terrific if, for example, we taught high school students Finance 101 — how to balance a bank account, how to buy a house when you’re ready, and the importance of saving for retirement. And it seems that unlike their parents, Gen Y is less likely to get its advice from the bank teller in our neighborhood, given that Gen Y does its banking online or with bank tellers who are on the other side of bulletproof glass. And Gen Y is probably unlikely to go to financial literacy seminars either.
Based on anecdotal stories, it seems that many twenty- and thirty-somethings turn to parents in these situations. It seems mother (and father) still knows best when it comes to who to see about buying a home, or what are the best 401(k) options. But this only reinforces the theory that wealth is generational. That is, children whose parents were homeowners are likely to become homeowners themselves due to family culture.
Another answer is that Gen Y is using each other for financial advice. walletwatch has certainly had many conversations with Gen Y’ers about what savings options are the best (I recommend ING Direct), who has the lowest fees on Roth IRAs, and where the best real estate investments are. Another answer is the internet — there’s a host of personal finance bloggers and columnists. But unfortunately the internet is full of financial scams (although less so post-housing crisis).
So where does Generation Y get its financial advice? I’m still trying to figure this one out and will keep blogging ’til I do.
Categories: Gen Y in debt · media and culture
Sen. Carl Levin (D-MI) continues the drumbeat for better credit card terms for Americans in this blog post on TPMCafe. Only a small group of senators are willing to take on the banking industry — along with Sen. Claire McCaskill (D-MO), who co-sponsored a well-crafted bill with Sen. Levin, and Sen. Ron Wyden (D-OR), who has a very worthy bill himself. Sen. Levin testified in the Financial Institutions and Consumer Credit subcommittee in the House (yes, the House) along with Wyden in an April 17th hearing led by Rep. Carolyn Maloney.
Despite Congress’s time being wrapped up in dealing with the subprime mortgage mess, there’s a chance that one of three well-crafted bills — Levin’s, Wyden’s, or Maloney’s — could see some action before the end of the year.
Categories: Uncategorized
That was the question on Hugh Hamilton’s most recent edition of Talk Back on New York-based WBAI. With guest Tim Westrich of the Center for American Progress, Hamilton discussed whether defaults on credit card-backed securities could have the same implications as the defaults on mortgage backed-securities, which sent capital markets in a freefall.
An archive of the radio show can be found here.
Categories: credit markets
Demos, a New York based think tank, really knows how to speak about the economic insecurity of Generation Y and churn out thoughtful solutions on how to deal with it. As Gen Y gets older, the widespread economic opportunity that once was so prevalent in the U.S. will evaporate. And with the continued shredding of the social safety net by conservatives — unemployment insurance, retirement savings, health care, and the like — its no wonder that Gen Y is in so much debt.
walletwatch is very much looking forward to a three-day conference by Demos, “A Better Deal: Reclaiming Economic Security for a New Generation.” The conference is free.
Here’s a summary and a link for more info:
It’s getting harder for young adults to get ahead in America. Compared to previous generations, today’s 20-somethings earn less, carry more debt and pay more for everything from health care to housing. With young people voting in record numbers, it’s time to put this generation’s economic crisis on the national agenda and build a movement for a better deal.
http://www.abetterdealconference.org/
Categories: Gen Y in debt · media and culture
