Many young people in California and nationwide are dealing with a growing debt burden. According to statistics released by the New York Fed Consumer Credit Panel and Equifax, people between the ages of 18 and 29 owe $1.05 trillion in debt. This burden is comprised of a number of different types of obligations, particularly student loans. However, it also includes a substantial amount of credit card debt, auto loans and mortgage obligations. This marks an increase in the collective obligations of young Americans; the last time this demographic had over $1 trillion in debt was in 2007.
Of course, young people are not alone in bearing a significant burden of debt. Americans aged 30 to 39 have $2.9 trillion in debt while people between 40 and 49 are $3.4 trillion in debt. People aged 50 to 59 carry $3.2 trillion of debt, those who are 60 to 69 have a $2 trillion burden and those 70 and up owe $1 trillion.
Student loans are a major contributor to debt, especially for members of the younger generation. Over 44 million Americans owe student loan debt, which has reached a total of $1.5 trillion. In the last decade, student loan debt has grown 100 percent, and some experts anticipate that up to 40 percent of borrowers may reach a default on these loans by 2023.
Student loan debt poses a particular challenge because it is extremely difficult to discharge in bankruptcy due to legislation passed by Congress in recent decades. On the other hand, people who are struggling with credit card debt and other types of consumer credit may find important options for their financial future by filing for Chapter 7 or Chapter 13 bankruptcy. A bankruptcy lawyer could provide advice and guidance on the next steps for people facing an insurmountable debt burden.
