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Your Take: Which Generation Has the Most Debt?

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Experian distributed an interesting infographic about debt that was a little light on statistics (there’s more at their new site) but interesting nonetheless. It compared the debt load on each of four generations, starting with the Greatest Generation and ending with Generation Y.

Generational Debt

One interesting takeaway from the infographic is that debt is highest in the Baby Boomer (Age 47-65) and Generation X (30-46) generations, with $101,951 and $111,121 respectively. Greatest Generation (66+) and Generation Y (19-29) have much lower levels of debt, $38,043 and $34,765 respectively. Remember that this is a measure of total debt, to include all loans and lines of credit. The average debt is $78,030.

If I were to guess, I think it has to do with how the generations have felt about the future. Baby Boomers and Generation X lived in periods of relative prosperity, knowing that tomorrow will be as good or better than today (and today was pretty good). The Greatest Generation lived through several world wars and the Great Depression while Generation Y has suffered through the dot com bust and the Great Recession. When you aren’t as secure and sure about the future, you save more than you spend because you don’t know what will happen. (this is all, of course, a guess)

Does this match what you’d expect?

{ 15 comments, please add your thoughts now! }

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15 Responses to “Your Take: Which Generation Has the Most Debt?”

  1. Sheri Miller says:

    I think it has to do with points in their lives. I think the reason the Baby Boomers and Gen X have more debt has to do with they have kids either at home or in college. Kids are expensive and you more things – bigger house, bigger vehicle, tuition, etc. I agree that the Greatest Generation is probably a lot better at saving than the younger generations because of what they have lived through. Just my two cents.

  2. PFM says:

    I would have thought Baby Boomers would have been highest by far, surprised to see Gen X as #1, maybe because their mortgage debt would be highest? I thought Gen Y would be lowest, harder to get credit now since the financial institutions have tighten up in recent years.

  3. Traciatim says:

    My guess would be the people in the middle have mortgages. Nothing to do with how they feel about the future.

    • Courtney says:

      Yep, that was exactly my guess as well. The oldest generation has (hopefully) paid their mortgages off, and the youngest generation hasn’t gotten them yet.

  4. Allie says:

    My parents (now in their late 70’s) bought their first home for 1 1/2 times their yearly salary. They sold it 10 years later for twice what they paid for it. The next house was pretty much the same. Their final home which they are still in cost them 50K in the early 80’s and is now worth over 450K and it is completely paid off. This is why they have no debt. Very few Baby Boomers or Xers would have been lucky enough to purchase a home for 1 1/2x their salary. More like 4-5x their yearly income.

  5. echidnina says:

    I think the Gen Y stats might be skewed a little bit if the age range starts at 19. People at that age haven’t even finished college yet, so they haven’t had time to rack up their full amount of student loans, car loans, credit card debt etc. Many are still renting. It’s an interesting thing to look at in theory, but I think you have to delve a little deeper to get meaningful numbers.

  6. daenyll says:

    As Gen Y I’ll agree to the skewing do to not being fully out on student loans and not having obtained mortgages, however I also have seen the mistakes of the boomers and the fact that nothing is certain. The only one to truly care for and look out for my future is myself, so I will save and avoid debt like the plague as much as I can. I am paying off the student loans as fast as possible and will do my best to have decent savings for vehicles and down payments in the future.

    • Ben says:

      Debt is NOT our friend. Live within your means.
      Borrow as little as possible, pay off as quickly you can.

      If only the Gov’t thought the same way.

  7. Des says:

    Its laughable to me to assume that the generational differences are a matter of personality rather than a matter of life stage. Older folks are retired (or nearing it) and paying off their mortgages and downsizing homes. They are done with child rearing, and have little or no reason to borrow money anymore since, presumably, they have a nest egg big enough to cover their expenses. Boomers are nearing retirement, and thus paying down the debt they acquired while building their careers and raising kids. Etc, etc. To suggest otherwise sounds like comment bait.

  8. freeby50 says:

    Mortgage debt is by far the largest debt. So this is all skewed by who has mortgages. Young people are too young to have bought and retired people have generally paid off their loans.
    If you remove mortgages then the differences are a lot lower.

    Also, the people age 40-60 are generally higher income and higher assets and those people with more money tend to have more debts as well. Another reason debt levels are skewed towards middle age groups.

  9. rlaw100 says:

    More of Gen-Y are currently staying at home instead of moving out, saving more of their money instead of spending, I think they see the problems that spending extravagantly can lead to in the boomers and Gen-X.

  10. Dj Hams says:

    I think it also has to do with the cost of things. When my father bought a condo in Myrtle Beach in 1990, he paid $35,000 for it when it was built. That same beat-up condo is about $90k right now.

  11. yourPFpro says:

    I think a more useful study would be to compare baby boomers at 20 years old to current 20 year olds and so forth. Of course older generations have more debt, they have mortgages, cars, etc. When you combine Gen Y’s student debt and rising costs it won’t even be close IMO..

  12. freeby50 says:

    Not everyone has student loans.

    Average debt is now about $27k for people who have loans. But only about 40% of people get loans to begin with.

    So the average student loan debt for all of Gen Y is closer to $10,000.

  13. Shirley says:

    Age appropriate life events seem to be the quantifier for the amount of debt here.

    I think it would be very interesting to compare attitudes and ability to follow through about spending/saving in these four groups.

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