Generations of Debt

31 - Oct - 2019
Credit Card Debt

Which Generation Is More In Debt?

The number of older Americans filing bankruptcy is growing. Of all generations, Gen X represents the most vulnerable generation. Many Gen X’s are facing more financial trouble than Boomers, Millennials or Gen Z. Although they have displayed many strengths and have overcome major obstacles, they’re managing longer-lasting financial challenges and have less time to come out of them. They currently hold the most overall debt, and have had less time than younger generations to build a strong retirement portfolio. Many in “Gen X” group are taking care of a large number of Baby Boomer parents. Many are also taking care of Gen Z children and continue to support older  Millennial children.


Long before Millennials, and following Baby Boomers is Gen X. Born 1965-1979, is Gen X. Gen X group represents a quiet but impactful generation of caretakers, leaders and mentors. As a whole, this group  chose to have fewer children, and are more educated than previous generations. Like Boomers, they entered the workforce and became financially independent at a young age. However, mid-career there were many surprises that came with the changes in society. For example, pensions were replaced by (401)k plans. The fewer number of years in the workforce couldn’t compensate for what has been lost. Nor could it provide enough time to take full advantage of a (401)k.  The likelihood that social security may not be there for this group is a real possibility. Today, Gen X continues to be “stuck in the middle.” They care for  Boomer parents, as well as Gen Z and Millennial children who are young adults. Unlike Boomers, most Gen X’rs will need to work after retirement to make ends meet.

More About Gen X:
-Last generation to:
-Enter workplace at young age & find indepence
-Remember life before computers or cellphones
-Embraced technology & innovation as collaborators & adaptors
-Survived market crashes including major foreclosure crisis & modern recession

Although they have paid off large debts and have greatly contributed to the economy and other generations:
-Recent statistics also indicate that they have the greatest amount of overall debt.
-Gen X is the group of population most at risk for future financial troubles
-Appear to be in a more desperate financial situation than younger generations.

-Highly educated, most comparable to Millennials:
-Many achieved degrees before online learning was an option
-Majority of student loan debts have been paid over time
-Many now have co-signed student loans for Millennial children

-Although smaller in number, they’re influencers:
-Account for more than 50% of leadership roles globally
-Have more spending power than other generations
-Represent larger percentage of U.S. income vs their population

-Carry the most Overall Debt:
-(401)k’s replaced pensions mid-career
-Social Security benefits not promising mid-career
-Caring for elderly Boomer parents & Gen Z children
-Supporting Millennial adult children


Millennials (Gen Y)

Millennials, born 1980-1994, are smaller in number than the older Gen X or younger Gen Z.  Like Gen X, and likely Gen Z; Millennials are also an educated group. Similar to Boomers, this group is more outspoken than Gen X. Several things make this group unique; their diversity, connection to social media, fast population growth, and initial delay entering the workforce. The impact of immigration has made this the most diverse generation in U.S. history. Some sources extend the term “Millennials” into two parts called (Y.1) and (Y.2) Doing this increases their population numbers, as well as the amount of debt. Extreme immigration influx could continue to expand this this part of the population and contribute to generations of debt yet to come. Currently, the main financial concern is student loan repayment. Following Gen X & Baby Boomers; Millennials have 3rd highest average debt amount. However, this generation has the potential to save the most. Millennials have much time and should be well-prepared for the future. They are young professionals working in a strong economy with historically more career choices and jobs.

More About Millennials (GEN Y):
More prepared for future:
-Live at home longer & marry later than previous generations
-Never had pensions & never planned for social security
-Started investing & using (401)ks at onset of career
-Investing more over longer period of time
-More women holding college degrees than men
-Have more time & earning capacity to repay debts

Due to immigration:
-They are more diversified than previous generations
-Population & debt could continue to rise

-More skills & opportunities:
-Using modern technology from beginning; tech savvy
-Socially connected; Facebook is most used social platform
-Enjoy a better economic environment than previous generations
-Many job opps in nursing, engineering, software, sales, etc.
-New opportunities in areas that involve virtual, social, and digital
-Only one main source of debt and that is student loans
-Education has more learning options & more careers available than before in U.S. history

-Student Loan Debt:
-College continues to become more costly with each generation
-Millennials represent a larger, younger population in post-secondary education
-Some students are taking longer to graduate; more years attending college
-Some degree programs don’t equate to desired living wages
-Some are not paying loans; placing them in deferment
-More students starting and not finishing degrees; leaving them with loan debt

Comparing Generations Of Debt

In recent years, much of the buzz has been about Millennials; most notably their struggle with student loan debt. Yet after sifting through a plethora of easily accessible yet differing facts and opinions, generations of debt exist. The problems are more complex than student loan debt in itself. Generations like Gen X, are impacted greatly by  those who came both before and after. It’s also important to note that generations as they are labeled traditionally represent populations that span anywhere from fourteen to twenty years. That is a long period of time with many moving parts and unique situations. People within the generational categories discussed in this article may or may not represent the general attitudes, problems or ideas of which they are labeled.

Common Generational Characteristics

Every generation from Baby Boomers, to Gen X to Millennials to Gen Z have more commonalities than differences.
For example:
-Each generation of debt has periods of progression, failure, unique circumstances, and challenges to overcome.
-All groups can note technical advancements, political unrest, family dynamics, shifts in culture, medical crises, world events, economic ups & downs, etc.
-Cost of education rises with each generation as do opportunities and new career fields.
-Characteristics of each generation of debt may have different complexities but in general, they deal with similar issues. Interestingly, research data will often compare “The Silent Generation,” (group previous to Baby Boomers), to Millennials to make a more drastic comparison. Yet the differences between each “back to back” generation continues to be less significant.

Generational Cohorts

Generational cohorts are the generational categories that mostly group populations by age. (Baby Boomer, Gen X, Millennials, Gen Z, etc.) Many sources go a step further using cohorts to explain the financial challenges, attitudes, trends, and other struggles that may change from one generation to the next. This is why groups of people have different generations of debt struggles and financial strengths. Debt that leads to bankruptcy is never expected and can sneak up on anyone at any time. Population numbers will impact each generation, as will factors such as jobs, education and debt. The primary difference between generations is found within attitudes, expectations, and responses.

It’s interesting to see how each generational cohort faces its unique financial challenges and navigates through them using different approaches and strategies. For example, Baby Boomers may focus on paying off their mortgage, while Millennials might be more concerned with managing student loan debt. A good strategy to handle these different types of debt is essential, no matter which generation you belong to. Additionally, being mindful of safety tips while shopping online, understanding the cost of subprime loans, and knowing how to challenge errors on your credit report are all important aspects of maintaining good financial health. For more information and resources, feel free to visit Debt Advisors Oshkosh Office.

Sources: Pew Research, Experian, Marketwatch, Statista, Inc, Washington Post, Breitbart, Forbes, Nerdwallet, Investopedia, USNews, U.S. Bureau of Labor Statistics

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