Homebound Grads
If you haven’t noticed already, here’s confirmation of a trend that started only recently: youngsters who have graduated from university are returning back home instead of going it alone. What’s driving this return home? Debt of course! Today, there a few tough financial lessons confronting many young people saddled with consumer debt and increasingly hefty student loans. According to Student Monitor, a New Jersey research firm that specializes in the college market, a graduate’s average student loan debt at $25,760. This will take an estimated 8 years to pay off.
Most of these students can ill-afford the cost of living alone and moving home is probably the only option left to them. If they tried to pay rent that would be just extending the amount of time it would take for them to pay off their student loans. And living within a budget becomes a priority for these recent graduates. Low starting salaries, minimal savings can only complicate matters. Washingtonpost.com reports:
Financial planners say that for those who live at home, saving money should be the top priority. Shashin Shah, a financial planner with SGS Wealth Management in Texas, advises young adults living at home to sock away at least 10 percent of their salary. That should be done in part through a 401(k) if offered by their employer.
Read more: Strapped Grads Get Financial Lessons on Familiar Turf
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