40% Of Millennials Are Hopeful They Can Get Rid Of All Outstanding Debt By 2025, Study Finds
09 Jan 2020
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- A poll has revealed that 40% of all millennials feel they are in a good position to eliminate all debt by the mid of this decade.
- The average millennial is carrying a debt of around $27,900, excluding any amount owed on mortgage loans.
A recent poll conducted by CreditCards.com through YouGov, with over 2,600 adults in the United States, has revealed insights about the credit condition of millennials around the country.
Millennials in this study were defined as those aged between 24 and 39 years of age at the time when the poll was conducted.
According to the results of the poll, around 40% of millennials are of the opinion that they would be able to clear their debt over the coming five years, with 10% hoping to have done so by the end of this year.
However, not all respondents were as hopeful about their financial progress. Around 7% said they would not be able to repay their debt in its entirety for the rest of their life. However, this figure is still much lower compared to the 20% who subscribed to the same concern in 2018.
There are a few reasons why millennials are feeling increasingly confident about their ability to repay their debt. As per Ted Rossman, who is an analyst working for CreditCards.com, the economy has been exhibiting a few positive patterns that are inspiring confidence in its participants across the board.
According to him, many companies on the stock exchange achieved historic highs in 2019, and the unemployment rate is at its lowest in the past five decades. Also, economic growth has also shown sustainable trends for more than 10 years.
The poll revealed that approximately 70% of all millennials are carrying debt in one form or another at this time. Since the most popular way Americans acquire debt is through credit cards, many of these millennials are paying high-interest charges as part of their overall cost of living costs.
A study conducted by Northwestern Mutual last year also concluded that the majority of debt that millennials are carrying right now comes from credit cards, and not from student loans as one might like to believe. The average amount owed by millennials in debt is around $27,900, which does not include any amount they may owe in mortgages.
Considering the high-cost credit cards entail, financial advisors are now recommending millennials to make it their top priority to cut down on their credit card debt. However, this may be very difficult for some millennials to accomplish, at least in the near future, considering the high living costs they have to bear which leave no room for debt repayment in excess of the interest surcharge.