Natalie Gonnella
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The WSJ's latest Number of the Week is really rather depressing, especially considering the enormous fiscal burden already forced upon Americans under 30 (aka the "Debt-Paying Generation").
According to this week's figures, members of the Class of 2011 not only have to worry about shouldering the overwhelming costs of Washington's spending spree (should Democrats continue their aversion to much needed budget reforms), they will also be coping with an average college debt of $22,900, earning them the title of the most indebted graduates ever:
Even as the average U.S. household pares down its debts, the new degree-holders who represent the country’s best hope for future prosperity are headed in the opposite direction. With tuition rising at an annual rate of about 5% and cash-strapped parents less able to help, the mean student-debt burden at graduation will reach nearly $18,000 this year, estimates Mark Kantrowitz, publisher of student-aid websites Fastweb.com and FinAid.org. Together with loans parents take on to finance their children’s college educations — loans that the students often pay themselves – the estimate comes to about $22,900. That’s 8% more than last year and, in inflation-adjusted terms, 47% more than a decade ago.
The WSJ also notes that:
In the near term, the debt burden could weigh on both the housing market and the broader economy. College graduates struggling to pay off debts are more likely to put off major milestones such as leaving home, getting married and buying a house, at a time when the creation of new households in the U.S. remains well below its long-term average.
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