According to BMO Financial Group, young adults aged 25 to 34 are on average richer than their parents were at the same age. Our age group has an average income of approximately $35,000 a year, while our parents earned almost $34,000. Plus, young families had a net worth of $52,000.
Unfortunately, our group is also shouldered with debt from mortgages, student debt and credit card bills. As a result, BMO says 84.4 per cent of households headed by young adults owe some form of debt compared to the 82 per cent in 1984.
Jeff Schwartz, executive director of Consolidated Credit Counseling Services of Canada, says the level of debt is an area of concern –
“The fact that a large majority of young households are in debt is alarming. We shouldn’t think of debt as being normal – although it seems like that is the mindset of many,” says Schwartz.
There are ways to decrease our debt and manage the additional money we have being Millennials.
- Pay off those high-interest credit cards first – You might be surprised how fast the interest can build on credit cards and if you pay the minimum payment on cards with high interest rates, all you’re paying off is the interest, not the bill itself.
- Want to own a home? Try and avoid it until your other debts are paid – It’s okay to still have a bit of debt when buying a home, but if you still owe a large amount of student loans or credit card debt, don’t put yourself further into debt by buying a home. It’s okay to still have an apartment and pay rent even when you’re 30 if it means paying off the debt.
- Move back in with your parents! – Yes I said it, move back in with your parents, if they’ll have you. I know, you want to have your independence, but if your parents are willing to let you move in, why not take it? Plus if they don’t charge you rent or only ask for a low amount of rent, you can save even more money, pay off the bills and save for important things like a house.
If you want to learn more about saving a lot of money without spending a lot of time, check out Consolidated Credit’s free Personal Finance educational section. If you’re struggling with debt, call one of our trained counsellors today at for a free debt analysis.