Has the World Gone Mad?

A while back I was chatting with a student who I had participated in high-school debate with quite some time ago, and I asked the student where she was going to college. She mentioned off the name of a top ten school that was very expensive. She proceeded to tell me that she was going into social work. I asked her how she was going to pay for all of that, and she said she took out student loans and will probably end up with over $100,000 in debt when she graduates. I asked her if she realized that she’s getting her self stuck in $100,000 worth of debt for a $40,000 a year job, and suggested that she go to an inexpensive state school where she could do the same thing for probably 25% of the price of the expensive private school. She said “I could, but then I couldn’t get away from my parents!” I retorted, you realize you’re paying over $2,000 a month for the privilege of being away from your parents. She responded, “And it’ll be worth every penny.” Sadly, this is only one of many stories I have heard about my friends doing crazy things with money.

I’m in my twenties and I have a lot of friends who make outright bad financial decisions on a regular basis. I wonder how these people justify it to themselves. I know a man who’s 20 years old, newly married and with a baby who wanted to go get a new sports car even though he was $120,000 in debt because of a house and a student loan. Another girl I knew put a new $1000 laptop computer on her credit card because the bank turned her down for a loan, and of course she needed a computer because she was in college. It didn’t matter that the library had computers, her parents had a computer, and that she couldn’t afford it!

What has happened to the world that young people are just so darn awful with money? It’s not just making a few simple mistakes here and there like not balancing a checkbook once and then getting an overdraft fee. People are just making outright mistakes with zeros on the end of it, and they never ask for council or opinion from others. I know that bankruptcy rates are exceptionally high, and now I know why. Young people are just certifiably bad with money. There are a few here and there that do okay such as my self, there is just a huge percentage of young people that make very bad decisions. I’ve had more than one of my friends buy into a MLM sales business, get excited about it, pay for a bunch of seminars, and then only refer one person to the business.

With stories like these, it’s no surprise to hear that the average college student graduates with several thousand dollars in credit card debt and tens of thousands of student loan debt! 19% of all bankruptcies are of people who are college age. This has to change. If we keep allowing young people to make huge financial mistakes without letting them know what the consequences are ahead of time, our economy is going to be in serious trouble in the next century. We have to teach our children how to handle money well, this is not an option; it is a necessity.