The Student Debt Trap: Why millennials are settling down later

The Student Debt Trap: Why millennials are settling down later

Photo Credits: ALLYSON KO / AGGIE

Mounting student loans are pushing back the prospect of marriage

There was a lot of talk about America’s improved economic status during President Donald Trump’s State of the Union address last week, but curiously missing from the dialogue was one particular $1.5 trillion elephant in the room — student debt.

Unsurprisingly, the ongoing student debt crisis was a major talking point in the official Democratic response. Delivered by former Georgia gubernatorial candidate and rising political star Stacey Abrams, the response called for leaders to “face the crippling effect of educational loans.” Regardless of where you stand politically, it is becoming increasingly undeniable that the U.S. is on the precipice of a major debt crisis. U.S. student loan debt outstanding reached a record $1.465 trillion last month, affecting all aspects of American society.

The institution of marriage has been hit particularly hard. According to a study published in the Journal of Family and Economic Issues, student loan debt is driving down the prospects of marriage for young Americans, while simultaneously increasing rates of cohabitation. The study, conducted by Fenaba Addo of the University of Wisconsin, compared data from the 1979 and 1997 National Longitudinal Study of Youth in order to determine changes in attitudes towards marriage, debt and cohabitation. While nearly 70 percent of the 1979 cohort had married by the age of 34, less than 50 percent of the 1997 group had done the same. Researchers also noted a stark drop in the number of people who married prior to living together; in contrast, they observed an increase in unmarried cohabitation, a logical consequence of the burden of debt preventing couples from marrying early. The cost of weddings and concerns over the financial prospects of incurring combined debt has dissuaded couples from the traditional timeline of marriage.

Unsurprisingly, this decline in partnerships is having tremendous residual effects beyond simply delaying marriage. According to one study, over one-in-eight divorcees now blame outstanding student loan debt for terminating their relationship. American birth rates are now at a 30-year low, and the housing market has been especially weakened by cash-strapped millennials.

After decades of rhetoric emphasizing a college education as the only effective ticket to the middle class, millions of Americans now find their prospects of upward mobility significantly wounded. Those affected by massive student debt belong disproportionately to the lower and middle classes. The primary goal of economic policies should be to ensure the safety and welfare of the American people. Solving student debt and the crisis of a declining middle class is part of that responsibility.

This will require a variety of different tactics. Financially secure universities should prevent the growth of student debt by gradually transitioning to no-debt based programs. This has been implemented by institutions such as Yale and Stanford, where grants have entirely replaced loans for students below a certain income.

Beyond the university, the collective bargaining rights of white-collar workers should be expanded in order to negotiate higher wages. Furthermore, stricter regulations should be placed on the visa system, which companies currently utilize to replace domestic American workers with cheaper foreign labor. The implementation of these practices would simultaneously prevent future debt from accruing and allow Americans to pay off what they currently owe more quickly.

Only then will traditional components of society be able to undergo restoration, allowing Americans to settle down, marry and have children when they want to, instead of drowning in the sorrows of their debts.

Written by: Brandon Jetter — brjetter@ucdavis.edu

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