More Millennial households in the US are in poverty

[WWGD]

So why is $30K in student loans a crisis, but $30K in car loans not?

I am not the OP in this regard, but you do obtain benefits from your car from the get-go, while you have to usually wait a few years to get the benefit of a college degree? A car pays for itself much faster than a college degree, and both have costs associated to the benefit ( Gas, Insurance for cars, loans + interest for College) both, I believe, averaging around $9000/year.

 

[Greg Bernhardt]

So now that we have established the numbers, why is $30K in student loans a crisis, but $30K in car loans not?

What's the average age of someone applying for a 30k student loan vs a 30k car loan?

 

[StatGuy2000]

Your post contains no numbers and roughly half a sentence of analysis. And I think we later established (after you pointed out a click-through link) that the first link wasn't even relevant to your point. I cannot fathom how you could possibly believe that represents sufficient depth.

First off, the very purpose of this post is to post my opinions on specific subjects. Opinions are that, opinions, and therefore should not fall under the same scrutiny that, say, a publication in a journal would involve. We have both posted opinions on various subjects before, and I don't think my post has any less depth than others.

I have no issue with your critiquing or criticizing my opinions, or offering differing opinions of your own (nor am I shy to offer my own distinct opinions). So long as we do so in a civil, respectful manner, I don't see what the issue is.

 

[Vanadium 50]

What's the average age of someone applying for a 30k student loan vs a 30k car loan?

I don't know the loan breakdown by dollar by age. Industry trades indicate that 18-34s are a) buying new, b) leasing more, and c) financing longer. So it's unlikely to be a huge effect. But I've noticed something interesting. I've posted actual statistics. The response is not "here are better numbers" - they are "those must be wrong, because they don't fit the narrative" - the narrative being the previously mentioned hipster, who through no fault of his own is left living in his parents' basement because he has no prospects.

What I have I posted?

• Demographic shifts are in the right direction and have the right magnitude to explain most - and quite likely all - of the changes in poverty numbers. The reason the poverty numbers are going up is driven more by the changing demographics of the 18-34's than the plight of our hipster friend.
  
• The average size of student loans is comparable to car loans. Why is only one of them considered permanent, crushing debt?

To continue, some other relevant factors for our hipster's plight:

• College costs have gone up, to be sure. The amount of work needed to get a degree has gone down. Shouldn't we consider both of these together?
• In addition to the net amount of work going down, the utility of majors is shifting. There are 122 universities in the US that offer a major in film. In 1980 there were more like ten: Northwestern RTVF, USC, UCLA, NYU, Columbia, a few others.

 

[russ_watters]

First off, the very purpose of this post is to post my opinions on specific subjects. Opinions are that, opinions, and therefore should not fall under the same scrutiny that, say, a publication in a journal would involve.

What you were saying in your first post that was problematic was not opinion: it was claims of facts that you didn't provide support for. That isn't acceptable here. At all. Anywhere on the forum. In the real world, you can base an economic opinion on a bumper sticker claim of fact that might not even be true, but not here. Even if the claims were throw-aways that you really didn't want to discuss (preferring to skip right to the opinion).

We have both posted opinions on various subjects before, and I don't think my post has any less depth than others.

Almost by definition, "depth" is how much information you provide. You must see that while your post contained no numbers, several of us responded with posts contining numbers. They are most certainly not equivalent levels of depth.

I have no issue with your critiquing or criticizing my opinions, or offering differing opinions of your own (nor am I shy to offer my own distinct opinions). So long as we do so in a civil, respectful manner, I don't see what the issue is.

Civil and respectful is difficult if people are following different rules/expectations, particularly when they are less strict than what the rules really allow for. This is the reason we finally did away with the politics section. It was too difficult to keep the quality up.

Your refusal to provide what others are providing is unfair, disrespectful and does not meet the requirements of the forum.

 

[nitsuj]

The average student loan is $30,000. The average new car loan is also about $30,000 (and there are many more of them, even when restricted to 18-34s). Why is the former a crisis, but the latter not?

Because in an extreme case I can park the car, call the loaner and say "Come pick up your car, I am done with it." I know of a real world example of such a case involving a "young" car brand and a lemon of a car...funny thing the loaner never repossessed it...must not have been worth it compared to writing off the debt.

It's VERY clear cut when a tangible asset is impaired, it is not as clear cut when education earning potential is impaired...but perhaps too easy to think the person must just be lazy, unmotivated ect.

I would absolutely trade all that I learned in college for the debt and choose a different earnings path.

 

[Bystander]

I would absolutely trade all that I learned in college for the debt and choose a different earnings path.

? Say again?

 

[nitsuj]

Suppose someone has graduated from college/university, with a degree in, say, physics (since we are here on PF). Let's assume that said student graduated from the University of Toronto (my alma mater), with debt in the tune of $80000 CDN (a conservative estimate based on tuition, residence, incidental fees, books & school supplies, and supplemental health insurance provided by the school for its students) at the age of 22. Suppose that she finds a job in Toronto whose starting salary is $30000 per year (a not-unheard of salary for those fresh out of school, if a little on the low end). Rent in Toronto for a 1-bedroom apartment is approximately $1800 per month, and not much cheaper for the surrounding municipalities. Our income tax is about 70%, so her take-home pay per month is approximately $20000 per year. Now $20000/12 = $1667 < the monthly rent. That means that she cannot afford to pay rent, let alone pay off her student debt or pay for her food, heat, electricity, etc.

Our income tax is no where near 30% for someone earning 30k. That's the 15% bracket (upto 45k next is 20% upto 93k!), for which there is a about 12k*15% in tax credits...in turn the rate is 18k*15% = 2.9k/30k = 9.6% effective rate...

Then that 80k in education expenses includes tax receipts for claiming the expense for tax credits...at 15% and is transferable to family. Education expenses today even includes the textbooks and bus passes!

Someone earning 30k is entitled to FULL retail sales tax refund (about 450$ a yr), also rent in ontario is eligible for a tax credit.

The provincial rate (ontario) is 5.05% upto 42k.

Done properly that imaginary girl wouldn't pay tax (it's source deducted so would have to wait until "tax season" for the repayment) for probably at least 3 years.

80k * 15% = 12k in tax credits that can carry forward to future tax years.
annual tax bill FED 30k-12k * 15% = 2.9k PROV 30k-10k * 5.05% = 1k Total 3.9k tax

12k in (non refundable) tax credits / 3.9k annual tax bill = 3 yrs of zero income tax. It would be longer due to income deductions for CPP and EI paid.

Also we don't pay income tax on the interest paid on a "student loan". same tax credit situation, interest paid * 15% = income tax deduction

 

[nitsuj]

? Say again?

lol I don't know how to reword it differently...which part is confusing? The give back the education part? Yea that's not possible and is the issue.

 

[Vanadium 50]

So why do you feel the education wasn't worth the money? More specifically, what changed your mind - you clearly felt it was worth the money when you enrolled and took out the loan.

 

[WWGD]

I don't know the loan breakdown by dollar by age. Industry trades indicate that 18-34s are a) buying new, b) leasing more, and c) financing longer. So it's unlikely to be a huge effect. But I've noticed something interesting. I've posted actual statistics. The response is not "here are better numbers" - they are "those must be wrong, because they don't fit the narrative" - the narrative being the previously mentioned hipster, who through no fault of his own is left living in his parents' basement because he has no prospects.

Still, now it is on you. You have repeatedly asked why a $30K loan for school is more crushing than a $30k loan for a car, and you have received two answers, and you have addressed neither.

 

[Greg Bernhardt]

So why do you feel the education wasn't worth the money? More specifically, what changed your mind - you clearly felt it was worth the money when you enrolled and took out the loan.

I can answer this in respect to my wife. She went to an expensive private liberal arts school. She graduated with honors from a top state high school. Even though she was a smart cookie she didn't really have a grasp of how all the pieces fit together in terms of financials and job market prospects. I think she would agree today that it would have been better to go to a good public university instead. Sure, it's her responsibility, but I don't think it's a unique story and it's hard for kids to see the long view when so much is uncertain and changing at that time in their lives.

 

[WWGD]

I can answer this in respect to my wife. She went to an expensive private liberal arts school. She graduated with honors from a top state high school. Even though she was a smart cookie she didn't really have a grasp of how all the pieces fit together in terms of financials and job market prospects. I think she would agree that it would have been better to go to a good public university instead. Sure, it's her responsibility, but I don't think it's a unique story and it's hard for kids to see the long view when so much is uncertain and changing at that time in their lives.

Hear, hear. In an ideal world we would only pay a reasonable price for not knowing better, specially when younger.

 

[Greg Bernhardt]

Hear, hear. In an ideal world we would only pay a reasonable price for not knowing better, specially when younger.

Indeed, my wife is leagues smarter than me and an amazing teacher with young kids, developing our next generation, and yes as a 30 year old she would be in fact living with her parents without our combined income.

 

[WWGD]

Indeed, in fact, my wife is leagues smarter than me and an amazing teacher with young kids, developing our next generation, and yes as a 30 year old she would be in fact living with her parents without our combined income.

Situations like this one are what turned me into a radical centrist. They illustrate well both sides/angles of many issues: the issue of personal responsibility as well as that of societal influence (insufficient guidance, false advertising). Neither seems to dominate influence-wise, i.e., the problem is not easily attributed to neither.

 

[opus]

For non millenials- did any of you get financial/life guidance in a formal setting such as in high school? I ask because it seems like people haven't the slightest clue on any form of fiscal discipline or responsibility. I wonder if having a mandatory class in high school would help this in a similar way that Sex Ed class informs students on STDs and pregnancy.

 

[WWGD]

For non millenials- did any of you get financial/life guidance in a formal setting such as in high school? I ask because it seems like people haven't the slightest clue on any form of fiscal discipline or responsibility. I wonder if having a mandatory class in high school would help this in a similar way that Sex Ed class informs students on STDs and pregnancy.

It may be the only sustainable way of going about. I used to intern at a place that aimed for just this, educating younger people about finance and providing them with access to many of the resources mostly the rich have access to. If boss hadn't been such an #@$ , I would still be working there.

 

[nitsuj]

So why do you feel the education wasn't worth the money? More specifically, what changed your mind - you clearly felt it was worth the money when you enrolled and took out the loan.

It's taken twelve yrs for me to get to an income lvl where the loan payment is "painless" financially. And that is average income lvl for the city I live in.

I feel over that time, it's the experience that's paying me more.

Two crucial components in the education I got. The jargon and two statistics courses.

I've come to see that a bus admin - accounting diploma is about as valuable as a degree in psychiatry...it's only half the required education to get to "good investment" levels of income.

I accept it was my choice for the loan, however tempted. At what income level and after what amount of time does the law say "Okay this debt is pooched." it's zero and never...fun game :D

Now let's have a look at the small business bankruptcy game...I've seen first hand how easy it is for a small business rack up bills, claim bankruptcy, open a new small business in a new area and do it all again...all within the law.

Instead of getting a student loan directly, I should've opened a small business, that brokers loans for education ;) that's learned from experience, conceptually wasn't taught in college...though it would have been an invaluable part of the mandatory 235$ orientation course...

 

[russ_watters]

I’m going to take the unusual step here to re-writing the OP in the level of quality and rigor I think the forum rules require and respectful treatment of readers deserves. I’ll do my best to match the intent of the OP, just in higher quality and more depth, while being succinct enough to be a reasonable. Please note: I don’t mean any offense by this, but I may be including statements I know to be erroneous and analysis I believe to be faulty/misleading/incomplete based on my perception in the thread – even things already pointed out. It will also mix-in quotes and paraphrases from the actual OP. This is all intentional to write this as a re-do of the starting point. I’ll also provide a little bit of structural guidance (and associated explanation) that wouldn’t typically be included in order to highlight the structure. I don’t actually advocate following a real template. This is intended to be serious; I will not throw in any “how could you do this to us you evil baby boomers!” silly shots in unless I think they truly, accurately reflect the intent of the OP. So, here we go:

-------------------------------

By Statguy2000 via Russ Watters

Intro
Hi everyone. I thought I'd point out some disturbing news related to the Millennial generation (those born in 1980 and afterwards) in the US:

Fact(S) to be Discussed [1]

http://www.pewsocialtrends.org/2011/11/07/chapter-2-income-poverty-employment/

Over time, more of those in the younger generations (under 35) are in poverty even as the older generations (over 65) have been improving. 30 years ago, the poverty rate for these groups was about equal at 17% whereas today the poverty rate among millennials is 22% and the poverty rate for baby boomers is about 11%. There is a lot of related contextual information in the multi-page article linked and I encourage everyone to read at least the page linked, on income, poverty and employment rates for more insight. [2]

Analysis of the Facts [3]
The graph shows long-term, continuous decline in the standard of living of young people that cannot be explained away as temporary due to the Great Recession or caused by “lazy millennials”.

Extension/Prediction [4]
This shows permanent injury to millennials that will in the future reverse the trend of improving standard of living for older people, causing millennials to spend their entire lives at lower standards of living than their predecessors.

Reaction [5]
What is striking is how this is not causing greater alarm with the broad fabric of American society that the younger generation has fewer opportunities for advancement and are living in poverty.

The end

---------------------

You should all note that this sample post contains most of the words of the OP verbatim, just more detail and a clear separation between facts and opinions. This clear separation is maintained even if you remove the headers from each section. And its not even a lot longer; take away the image and it is perhaps only twice as long.

[1] Just the facts. No reaction, analysis, anything. Just the actual data, a link to the data and its background and a re-stating of the facts in my own words. This is intentionally dry in order to start the discussion off from a place of agreement; everyone should agree that facts are facts. And everyone must be afforded the opportunity to look at the facts being claimed. If we can’t even agree on a starting point and/or people aren’t given an opportunity to look for themselves, the discussion is unlikely to become productive.

[2] Everything to this point is the minimum I would consider acceptable as a starting point for discussion. It at least tells everyone reading what the topic data is and where the data came from. The next section is preferred but it is more common for people to just take a glance at facts and post an initial reaction without analyzing where the numbers came from and how they came to be.

[3] Analysis should be closely fact-adjacent, putting the facts in the context of other facts and describing relationships and trends. Still no opinions. I won’t call this section mandatory because it takes some analytical skill and emotional detachment to be able to provide opinion-free interpretation. It is a component of a high quality post, but is more than I think can realistically be expected from everyone.

[4] Here’s where the gloves start to come off. Predictions are by definition speculative and reflective of our biases, such as confidence level in the direction of a trend that isn’t consistent. This is where deviation from academic analysis really starts because for academic analysis, that’s not good enough: you need mathematical modeling, not gut instinct, to make the predictions. What I did here doesn’t even reflect trendlines the graphs could generate. This section I do consider mandatory.

[5] Here, the gloves are totally off. This is pure opinion and emotion. But since this isn’t the entirety of the content of the post, we have some real meat that came before it to understand where this opinion/reaction came from – and we [responsible responders] start at the top and work through, not at the bottom, trading emotional reaction punches in the dark. This section is optional and even discouraged, but is typically included.

So, @StatGuy2000 I invite you to take a day to review and edit this to make it your own, if you choose to. After that, I’ll respond to “your” new opening post. I sincerely hope people see this as a sincere explanation of what I'm looking to see. It's an unusual post, but an honest effort at a teaching moment.

 

[nitsuj]

View attachment 218206

That's the first I looked at the graph.

Clearly us millenials have been duped by those older and in positions that determine who gets paid how much.

 

[bhobba]

The trend of delaying adulthood is real and predates millenials, so it cannot be blamed entirely on the recession. I'm 42 and I've seen friends/acquaintences in my age bracket make immature/selfish/passive life choices in their 20s and 30s that likely would have horrified Boomers.

That raises an interesting question - when does someone become an adult. That however requires its own thread.

The only comment I will make here is where I live in Aus many many moons ago someone noticed a disparity - you could be drafted and die for your country at 18 but not vote for it. So what did they do - lowered the voting age to 18. I remember thinking at the time (I was only 18 or so myself and knew I was immature) its likely better to raise both conscription age and voting to 25 - but politicians I think find conscription in general a touchy subject. Australian culture is very much against conscription, and it was written in our Constitution its not allowed. A referendum was needed. One was held and was soundly defeated. I still never understood how it became possible - some legal eagle in Australian law needs to explain that one - I have no idea. But anyway a volunteer army is always more effective so don't understand its need and never will. No country has ever lacked sufficient volunteers when and if the need arises. My 'feeling' for what its worth is politicians want it because the public can too easily see through BS when its their own life on the line so are scared like crazy if it comes to war they will be found out for what they so often do - do it for political reasons - not actual necessity. But this is getting off topic and needs its own thread.

Thanks
Bill

 

[bhobba]

Situations like this one are what turned me into a radical centrist.

You too?

I was once just slightly to the left of Atilla The Hun - Ayn Rand was my hero (until I saw through her errors - which actually isn't that easy - she has persuasive arguments - but her downfall is - as pointed out by her once disciple - Nathaniel Branden - she came to believe she was 'infallible' and others were automatically wrong - at least that's his view anyway and I tend to agree with it - very very anti-scientific) - but life experiences change all sorts of things and I now know things are not quite as simple as the left or right sometimes portray it. Nearly every issue is very nuanced. That's one reason I am enjoying this thread .

Thanks
Bill

 

[bhobba]

For non millenials- did any of you get financial/life guidance in a formal setting such as in high school? I ask because it seems like people haven't the slightest clue on any form of fiscal discipline or responsibility. I wonder if having a mandatory class in high school would help this in a similar way that Sex Ed class informs students on STDs and pregnancy.

No - got nothing.

But I did trade shares on the side for a while - that is a very financially illuminating experience. Don't do it now - I saw too much 'light' - although I still subscribe to a newsletter on a certain trading method based on momentum simply out of interest.

The only financial book I trust after that experience is one very old and out of print by a guy called Austin Donnerly:
https://www.fishpond.com.au/Books/Sensible-Share-Investing-Austin-Donnelly/9781875857159

It works on a very well known scientific principle - regression to the mean - in investing circles sometimes called contrarian investing. Buy when people are scared and selling like crazy - sell when they are buying everything is sight. How to you determine which is which - simple run a line of linear regression through the market index - if its way below the mean - buy - way above - sell. Actually you do it in stages - a bit below - buy a bit more - a lot below - buy a lot more and conversely. Above and below the line of regression is divided into zones for that purpose.

But I generally am in favor of financial literacy being a compulsory subject at HS. I remember a long discussion I had with a financial adviser on this very issue. His wife was a teacher and while he of course, like me, believed in the value of financial literacy - said, according to his wife, the curriculum is so crowded now its unlikely it could be fitted in without a howl from some sector or another- eg the foreign language enthusiasts who believe you need to study a foreign language all though HS.

Thanks
Bill

 

[opus]

Yeah that's nuts to me. I studied Spanish every year in high school, was required to take drivers ed, art, sex ed, and gym class. I think financial literacy is at least as important. The school system is a mess. But that's for another thread.

 

[russ_watters]

For non millenials- did any of you get financial/life guidance in a formal setting such as in high school? I ask because it seems like people haven't the slightest clue on any form of fiscal discipline or responsibility. I wonder if having a mandatory class in high school would help this in a similar way that Sex Ed class informs students on STDs and pregnancy.

No, I didn't and yes, I think it would help. Fortunately for me, my parents made an effort to teach me when I was a kid (doing my own taxes, them buying stock in my name and letting me pick, reading a bank statement, etc.). I knew of friends who were clueless about money in high school for whom it continued to be a problem later on. It's such a huge problem, I have no idea why an effort isn't made to do anything about it.

 

[Vanadium 50]

Because in an extreme case I can park the car, call the loaner and say "Come pick up your car, I am done with it."

In the US, if you do this, you still owe the money. It is true that subsidized student loans are not dischargable by bankruptcy. However, as a practical matter I don't think it matters: car loans and student loans have essentially the same default rate: 11% vs 10%,

and you have received two answers, and you have addressed neither.

How dare me! It's been literally hours! Don't I have anything better to do!

In any event, I think the more germane response was that nitsuj had an expectation that a particular college degree would entitle him to a given future income, and that didn't happen. There was a famous 2008 US News and World Report article claiming the Net Present Value of a college degree was - on average - $300,000. The key to that is - on average - as they say "your mileage my vary".

 

[WWGD]

In the US, if you do this, you still owe the money. It is true that subsidized student loans are not dischargable by bankruptcy. However, as a practical matter I don't think it matters: car loans and student loans have essentially the same default rate: 11% vs 10%,
How dare me! It's been literally hours! Don't I have anything better to do!

.

I thought you were including my post in your comment, and the same applied to me, i.e., it had only been hours. EDIT: There is the additional issue, to being able to benefit from the car right away --without having to wait some 4 years -- of the fact that the amount of energy needed to benefit from owning a car (e.g., oil changes, pumping gas, occasional wash ) is nothing in comparison to the amount of effort needed to obtain the degree: attending classes, studying, writing papers, etc.

 

[WWGD]

<Snip> I have no idea why an effort isn't made to do anything about it.

It is being made, but not fast enough nor with enough resources. Some institutions ( schools, here) are both more resistant to change and slower to adapt. I was stating in another post that I worked for an organization one of whose goals was precisely that, but it was a bootstrap operation. I enjoyed working towards goals like this one , but at the end the boss was too much of a #$% and I quit.( Worse of all, when changes do happen, they are often the wrong ones, like adopting PCs in classrooms, whose benefits have not materialized; there is something to having to write things down, visualize them on your own, instead of doing an online search. At least at this age and developmental level.). This is one of the essential problems nowadays, when the rate of change outpaces the ability of existing institutions to adapt. Check out, e.g., Future Schock, presciently written in 1970 by Alvin Toffler ( who , sadly, died in 2016). Interestingly, to tie all topics here together, I wrote a paper on this book in college (1990s)

 

[WWGD]

No - got nothing.

But I did trade shares on the side for a while - that is a very financially illuminating experience. Don't do it now - I saw too much 'light' - although I still subscribe to a newsletter on a certain trading method based on momentum simply out of interest.

The only financial book I trust after that experience is one very old and out of print by a guy called Austin Donnerly:
https://www.fishpond.com.au/Books/Sensible-Share-Investing-Austin-Donnelly/9781875857159

It works on a very well known scientific principle - regression to the mean - in investing circles sometimes called contrarian investing. Buy when people are scared and selling like crazy - sell when they are buying everything is sight. How to you determine which is which - simple run a line of linear regression through the market index - if its way below the mean - buy - way above - sell. Actually you do it in stages - a bit below - buy a bit more - a lot below - buy a lot more and conversely. Above and below the line of regression is divided into zones for that purpose.
Thanks
Bill

There are other techniques, AFAIK, like knowbots using ML ( Sentiment Analysis ) going over blogs , counting and weighing key words denoting "Irrational Exuberance" , Panic , or in-betweens ( Not as many opportunities).

 

[WWGD]

I

In any event, I think the more germane response was that nitsuj had an expectation that a particular college degree would entitle him to a given future income, and that didn't happen. There was a famous 2008 US News and World Report article claiming the Net Present Value of a college degree was - on average - $300,000. The key to that is - on average - as they say "your mileage my vary".

https://duckduckgo.com/?q=flaw+of+averages+definition&t=hf&atb=v88-7&ia=web

There is a book by this actual name. It details cases where considering only the average value created problems, like the case of expeditions to the Arctic circle who chose to take a certain number of coats to their expeditions based on the average duration of a coat. No consideration for spread, nor for which type of error : too many or too few, would be worse in that case :https://www.amazon.com/dp/0471381977/?tag=pfamazon01-20

 

[nitsuj]

nitsuj had an expectation that a particular college degree would entitle him to a given future income, and that didn't happen.

lol entitle me to a given future income? Err no, that's not education. that's experience. google the definition of entitled...your suggestive comment doesn't even make sense.

What's more it has "happened", after an amount of time that experience is the increase in my pay; thought that point was clear. It didn't get me in at a higher pay tier.

I didn't say i was entitled to anything, I implied I wasn't treated as fairly as a business entity. And that experience improves income over time.

Education slots one into an income level after grad...accounting diploma low end start salary not enough to pay monies loaned.

I do feel entitled to be treated the same as a business entity with respect to such a loan. In which case loaning me the money in the first place probably wouldn't have happened or to mitigate loaner risk be guided towards a less risky/more profitable endeavor by a "professional", either way... win win

 

[nitsuj]

It is true that subsidized student loans are not dischargable by bankruptcy. However, as a practical matter I don't think it matters: car loans and student loans have essentially the same default rate: 11% vs 10%,

When it goes to "default" its with respect to the loan agreement which means it can go to court and the law (a judge decides) what should become of the debt. In the case of a car, I can put it on the bankruptcy list and have the debt extinguished. That cannot be done with a student loan, the loan still exists and is owed and has defaulted...in such a case the judge is to permise income source deductions / bank withdrawals. However it's my understanding while strict do consider circumstances, particularly for health/disability reasons.

By law one who is not employed cannot be "sued" for the student loan.
Ontario, CAN laws.

The likeness of the default rates tells me my argument is legitimate. Student loan debtors are not simply deciding they don't want to repay, they want to repay the debt equally to car loan debtors who can extinguish the debt through bankruptcy.

 

[ModusPwnd]

The average student loan is $30,000. The average new car loan is also about $30,000 (and there are many more of them, even when restricted to 18-34s). Why is the former a crisis, but the latter not?

Some differences. Witha car loan one is actually vetted to some extent to make sure they can likley pay it back. My student loans came with no means to pay them back, just hopes and dreams. A car can be sold and your debt lowered or even erased. I can't sell my education for pennies on the dollar to reduce my debt.

But in the end, in my household, a 30k car loan would be a crisis. My student loans easily go into deferment and income based repayment. A car loan does not. Student loans are holding my family down. A car loan would crush us.

 

[russ_watters]

Thread closed. Rebooting here:
https://www.physicsforums.com/threa...lds-in-poverty-re-launched-discussion.936791/