Debt falling sharply among young people: Study
The recession had a strong impact on young Americans who saw the credit crisis up close: they are taking on less credit card debt, delaying plans to buy homes and owning fewer cars, according to a study released Thursday.
From 2007 to 2010, the median debt of U.S. households headed by people age 35 and younger fell by 29% from $21,912 to $15,473 - while debt of older Americans fell by just 8%, to $30,070, according to the Pew Research Center study, "Young Adults After the Recession."
Residential property accounts for at least three-quarters of average American debt, so much of the drop may be connected to a decrease in home ownership. The number of Americans under 35 who own their primary residence dropped to 34% in 2011 from 40% in 2007, Pew said. Meanwhile, the percentage of homeowners over age 35 fell by 2 percentage points to 72%.
Young adults are cutting back on credit card usage as well.
Young households with credit card debt fell by 10 percentage points to 39% between 2007 and 2010.