"I, Breadwinner? - View of Debt from the Left"

Your dad had a job, a wife, a house. You've got loans and fear of commitment. Hello, manhood. December 21st, 2004 11:55 AM.

Don't worry about the loans. I'm doing good, Dad, and it's gonna stay that way. Bud Fox [Charlie Sheen] in Oliver Stone's Wall Street.

When I started college, I needed and wanted funds—for an apartment, a car, a girlfriend, alcohol, and of course, tuition. Conveniently, the dorms and lecture halls were strewn with credit card applications, which are as much a part of the university experience as Wednesday-morning hangovers. The plastic loan sharks beckoned with low monthly payments and generous credit lines. It was an offer few of us could refuse.

Naturally, credit cards, with their usurious interest rates, were just the start. Student loans, a fact of life for nearly every red-blooded (as opposed to blue-blooded) American, were a much bigger deal. And the bonus was you could begin paying them back after graduation or, at any rate, in the distant future. It wasn't my problem, I reasoned. It was the problem of some future version of myself. Screw him.

Thus was a Matterhorn of debt created. But as I morphed from a twentysomething into a thirty-nothing, the realization began to dawn: Will the supersized student loans and maxed-out credit cards stay with me until the bitter end? Will I spend the rest of my life barely making rent, forever beholden to myriad creditors? Will I be able to purchase a home? Will I be solvent enough to provide, God help me, for a family? Will, in other words, there be consequences to an early life of profligate borrowing?

Well, yeah. "As a group, young adults underestimate how long it will take to repay the debt," said Jill Norvilitis, an associate professor of psychology at Buffalo State University, who has studied collegiate debt.

For many young men beginning their stroll through adulthood, debilitating indebtedness spawns a problem that goes beyond the figures on a bank statement. It's the growing sense that you won't be able to live the kind of life you hoped, the kind of life you grew up expecting. "It's incredibly depressing," said Paula Langguth Ryan, an author and lecturer on bankruptcy. "It's emasculating. They wonder, 'How did my parents do this? I can't possibly do this. How can I tell my father that I'm so far over my head I can't buy any presents this Christmas?'

"You get onto that roller coaster of paying off the debt, but it still keeps going up," Ryan added. "You're just spinning your wheels and huge frustration mounts. 'How can I tell the person I am dating that I am this far in debt?' "

Eric Heidt, 33, a Manhattan architect, just refinanced his student loans. Now the payments are manageable, but they're also eternal. "It's going to take me a lifetime to take care of it."

Heidt is living out an economic reality that his father might scarcely recognize. "Buying a house is pretty much out of reach," he said. "My parents had a bunch of kids, they bought houses, and here I am living in a 12-by-16 room with a stranger and I'm not saving any money. There's something wrong."

The lives of young adults, male and female, have changed over the past few decades. For one, fewer of us are getting married in our twenties and even thirties. Figures from the U.S. Census Bureau's Current Population Survey show that, among 30- to 34-year-olds, the marriage rate in 2003 was four times lower than it was in 1970. Among 20- to 24-year-olds, 75 percent of women had never been married—compared to 36 percent in 1970—and 86 percent of men had never been married—compared to 55 percent in 1970. It's just not an essential part of how young men see their post-graduation life these days.

According to a 2002 Rutgers University study, young men are reluctant to marry for several reasons—they think it will require too many changes and compromises; they aren't confronted with social pressures to make the leap; they can just as easily live with a woman as marry her; and, to put it quite simply, they would rather enjoy the single life for as long as humanly possible. "Some of these men have spent a good part of their early adult years living with parents, roommates, or alone," the study's authors wrote. "They have become accustomed to their own space and routines. They enjoy the freedom of not having to be responsible to anyone else."

But the study also cites several financial reasons for putting off the marriage decision. Young men fear divorce and the financial risks it would bring, including child support. And most would like to purchase a house before taking the vows.

It's clear that young people aren't buying homes at the same rate as previous generations. Even though interest rates have plummeted to historic lows in recent years, causing a surge in home ownership across the country, the number of home buyers under 45 has remained steady nationwide since 1980. In New York City, only the lucky few can afford to purchase property. The white picket fence carries an entirely too costly price tag. We are a far more transitory generation, picking up and moving from apartment to apartment, job to job, relationship to relationship, city to city—all while being followed by the black cloud of the financial choices of our late teens and early twenties.

This wasn't what our parents had in mind for us. Many young men grew up hearing their fathers lecture on the importance of financial stability, business success, and home ownership. The thrust of these soliloquies was that if you make the right choices you won't have any problems. If I did it, so can you, son. But there was a caveat: Don't be stupid with your cash. (Also: You'll get none from me.) Implicit in all this was the suggestion that foolishness with money equals weakness. Debt was a moral deficiency. It's not the way a man conducts himself.

Easy for them to say, we thought. They didn't grow up in the age of easy credit. The credit card is just 40 years old, and it wasn't until the 1980s that a young person could get one without a signature from a parent. They didn't have to struggle to pay for an education. College is now hugely expensive—and a required step on the pathway of American citizenship. Avoid the university, we are told, and you'll wind up as a telemarketer. (You probably will anyway.) They didn't have to carry debt. We do. It's part of our life today.

"You have to remember, in the past, credit wasn't in common use," said Ryan. "You didn't have people slipping a credit application into the books you are buying at the college bookstore. Back then, nobody borrowed on credit. Bankruptcy carried a huge stigma. You would literally sell everything you had of value to repay your debts. You often knew your creditor—it was the butcher or the plumber. Now creditors are faceless."

The average man doesn't think about the problems of debt until the first bad credit report prevents him from buying a car or obtaining a mortgage (both of which, of course, would grant him the luxury of more debt). That's when he feels the sting. That's when his life begins to feel ill-considered and wasteful. He curses himself for taking that trip to Jim Morrison's grave on collegiate plastic. He kicks himself for enrolling in two semesters of Hungarian instruction, a beautiful language no doubt, but about as useful to him today as a hole in the cranium. Indeed, at times like these his entire college education looks like a waste of money.

"It's painful," said Barry Glassman, a certified financial planner who counsels law students. "If you don't make those monthly interest payments, you get a horrible credit rating and it goes on your permanent record. It's part of that anchor that is dragging you down. I see it with law students who I think would be great in the public sector. But they can't afford it. As a financial planner I can't see the numbers working. It forces people to take jobs they wouldn't normally take.

"It's tough to think long-term when there are so many pressing issues month to month," he said. "You cannot fathom buying a house when you are trying to make a $400 payment every month."

The problem is heightened if you have trouble finding a job in this time of fewer opportunities. "It's especially hard on people who are trying to get established, trying to get their foot in the door," said Gregory Kuhlman, director of the personal counseling program at Brooklyn College. "If you already have a decent job, you might be nervous, but it doesn't hit you like it does if you are pounding the pavement for six months."

At this point in the saga, the typical young person might feel a little resentment, particularly when he reviews his parents' history and decides that they had it easy. They had no trouble finding decent work and buying that first home. The system then in place was designed to give them a good chance to achieve a chunk of the American dream, however they defined it. The system now in place rewards those wise folks among us who at age 19 had the foresight to worry about how their financial statement would look at age 30. All 10 of them.

The solution is to begin chipping away at your debt burden. "The only way to empower yourself and take the power away from the debt is to face up to it," said Ryan. And quit charging—anything. Chuck your cards out the window, she suggested. Detach yourself from a way of living that depends on the "drug" of easy credit, said Ryan.

In my experience, I saw that things have a way of improving over time. I slowly dug myself out of the hole. I was aided by the fact that I wasn't able to accumulate more debt, even if I wanted to. Incremental increases in my salary enabled me to pay off my early-college credit cards. I made peace with the banks that issued my student loans and began paying restitution to them. In short, I figured out a way to manage my debt, which is, after all, the most any of us can hope for in the worker's paradise of 21st-century America. Like Michael Jordan on the basketball court, the average American's debt cannot be stopped; it can only, with luck and fortitude, be contained.

While I think you're doing the right thing by tossing him out of the house, I don't think he deserves the bitterness from you.

If you wonder why he is the way he is, you provide the clue when you describe your parenting style. You said it yourself:
1. "Our children wanted for nothing"
2. At least one is still living at home and is in his mid 20's.
3. I'm guessing neither of your sons paid you rent to live there after they were out of school.

Sorry to be so harsh, but I get tired of parents who coddle their kids and then get mad because they grow up to be irresponsible. These young men still need your love (which is expressed through appreciation and respect) and not your coddling (which is done by always rescuing them from their responsibilities). Check out www.loveandlogic.com for some more specific strategies.

It's all about deferred pleasures, anathema to to many left-wingers.

There also seems to be a pervasive cultural pressure that says, "Live for today: your 20's are the only time in your life worth living, and if you don't have it all RIGHT NOW, you'll never get it or you'll be too old to enjoy it anyway." A brilliant marketing strategy for those who are selling expensive consumer electronics, but it's lousy financial planning advice. ;)

Well, as a person who did study French Impressionism in college- and LIKED it- I will be offended ;-)

No one puts a gun to anyones head and makes them go into debt. I have very little simpathy for people with bad credit ratings. It is a matter of personal responsibility. Live in the dorm all four years (or more). Eat in the cafeteria on the meal plan. SAVE your money instead of spending it all on your cell phone bill!

Ma Dad always preached the old adage about only borrowing for the house, the car, and for an education.

We have never borrowed for anything else and the only debt I have ever had to my name was for two of the above-mentioned three. And of course the debt I owe my Dad for his advice.

Call me debt-free and not shedding any tears for 33 year old architects in New York who can't manage a simple budget.

You're right, well put! I asked a friend at a Christmas party what he got for Christmas and his reply was, we really don't need anything.

It's the "Need it" as opposed to the "want it" generation.

If everyone had to go on a no-credit-card buying spree how much would really be bought with cash? Put Those evil credit card companies out of business ;)

I have always thought that below that top tier of some 50 universities and 50 odd national liberal arts colleges, it made little sense to go to a private college or university rather than a public university. While I think that the many many smaller private colleges are run by sincere people who are doing the best they know how, I honestly believe that they do their students a disservice when they are priced at or just below the level of the top tier institutions without being able to provide the benefits.

You are absolutely right. But I would go farther. Most employers couldn't care less about where someone goes to school. They may want a college grad, but rarely do they care what college or university granted the degree. The exception would be in certain highly specialized fields where the school does make a difference. Only a handful of universities and colleges make any difference whatsoever to employment prospects. Going into major debt to attend an out of state institution is almost always a huge financial mistake.

Interestingly, a person's G.P.A. -- a big deal in college -- is seldom an issue in employment. In the course of my former career, I've looked at hundreds (maybe thousands) of employment applications from a variety of companies. Only a handful asked for a G.P.A.

Kids these days are facing enourmous debt. Perhaps my family's experiences illustrate the changes. My father went to law school after WW2 on the GI Bill. He and my mother lived on my mother's salary as a bookkeeper. He started a law practice without one nickel of debt.

I went through college having my meager income supplemented with grants, and a $15,000 student loan.

My son, who is active duty military, has completed an AA degree, a para-legal certification and is nearly complete on his bachelors, has done all this on the GI bill but it's part-time and taking years and years. My daughter starts at Smith in the fall. We estimate she'll graduate owing $60,000.

My daughter starts at Smith in the fall. We estimate she'll graduate owing $60,000

Love those STEP loans @ $15,000 per year....

Well, Smith is a choice, and a pricey one at that. It's a good school, one of the seven sisters of old WASP establishment fame, and probably still good for the connections. If your daughter was good enough to get into Smith, she could undoubtedly have gotten scholarships to your best in-state public university. That could be a hard choice, depending on the state (in Viriginia, Michigan, North Carolina, Texas, California, or Wisconsin, the top state schools might even be preferable; in Arkansas or North Dakota or Idaho, Smith wins hands down, in between, it gets harder)

"Some of the ex-husbands simply refuse to pay child support."

Not possible in the Age of Clinton. He made it so your paycheck gets garnished (regardless of whether or not you were faithful in your CS payments)

There's at least one case in TN where, so far as I know, the father takes odd jobs, gets paid cash, and doesn't pay.

Both Berkeley and UCLA are closed to transfer economics majors? Ouch, that's a new one. In my day in the late 1960s, junior college transfers with 3.0+ averages in UC-transferable courses were guaranteed transfer to UC, and those above 3.5 guaranteed campus of choice, state college transfers I think had a harder time.

I didn't know Smith was known for economics. My older daughter (now a sophomore at St. Olaf) and several of her friends visited many of the seven sisters, but were all put off by the heavy lesbianism (one girl even had a pass made at her at Wellesley on her overnight!). My younger daughter and a friend visited Bryn Mawr this past fall and liked it better than the others. My daughter would have considered it seriously had they had a good music program.

Smith isn't known for economics, but it is now part of a consortium including Amhearst and Mr. Holyoke which offer a greater diversity of courses and faculty. The lesbian thing causes me no small amount of concern, but boyfriend attends U Mass., so for now, I keep smiling.

Probably chose the wrong word! I mean the lifestyle that demands they have a new, new car at 21 and a their first home be 2,000 square feet with heating, air, plasma tv, washer dryer, carpeting, two-car garage, screen enclosed patio, etc. I didn't intend to refer to the birth rates. Oops! Thanks for bringing my attention to it!

Ah, the fog lifts. That five college consortium is a big selling point. All of those schools (except U.Mass) are outstanding in one or more areas, Amherst being generally the strongest. One of my daughter's friends was just accepted early decision to Amherst, another to Williams, three to Dartmouth, two to Harvard, one to Yale, one to Wesleyan, and one to Stanford. Big year. But, because my daugther wants music performance, she has to apply regular, go through auditions this winter, and won't know until April where she'll be going. Her considerations are very specific, however: which studios (that accept her) does she think will give her the best training and provide the best contacts for job opportunities. And then we have to figure the money out.... it's not worth going to a school even for free if you don't think the teacher can give you what you need, but there may well be some trade-offs that end up being made. Part of the problem is that the best and most selective school (right now) for her instrument happens to be very expensive and gives little merit aid. That one would be hard to turn down, even with some debt, because right now there's no 'second place' -- the next best is even harder to get into, but free (Curtis), and after than, we start making tradeoffs.

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