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Thursday, November 12, 2015

Young and Educated? You're Probably Living With Mom and Dad

Interesting article in the New York Times about how 20 and even 30 year olds are still living at home.
Anyone who has a student loan knows the answer to this, it's so simple, but the New York Times, always a day late and a dollar short is confused. They are today's Fool.

“Some of what’s happening is probably economics, because the great recession really hit young adults hard,” Dr. Fry said. “But I’m still struggling with the economic explanation, since the labor market for young adults has improved in the last five years, and yet the percentage living with their family is still going up. It seems to be somewhat decoupled from economics.”

No, Sunshine, it's actually kind of simple economics. Rents have gone up, waaay up, and salaries have gone down. But the real problem is, most young people have at least $100,000 in student loans and the loans get bigger every year, thanks to compounding interest. After paying them, even with IBR, there's precious little left to do things like paying $3000 a month for a studio in NYC when you are lucky to be making $50,000 a year.

And this fool has a doctorate, as if anyone needed more proof that higher education is a waste of money.

full article here:

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