Millennials face a plethora of issues, among them student debt, a competitive job market, and not having the financial wherewithal to afford a home or car. I’ve already touched upon these topics in previous “My Generation” blog entries. Now, I’d like to revisit them using a real person rather than the ever-elusive “millennial” moniker.
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Syed is a 20-year-old student at the University of South Carolina. He is in the mechanical engineering program at USC and is in his third year at the university.
Syed and I are singular snapshots of a generation defined by its diversity. But his story offers insight into what others in similar situations are dealing with. I will work to find and include people like Syed in my future blogs to tie a real person to the rhetoric.
Who Is Syed?
Syed, like many other millennials, is on a tight budget. According to Student Loan Hero, the average graduate in 2016 had $37,172 in student loan debt; that’s up 6% from 2015.
“Without financial discipline, I wouldn’t be able to live my everyday life,” Syed says. “It is necessary I keep track of my finances to maintain stability in my life.”
If I had the option and the knowledge, I would try a credit card.
Syed balances a $15,000 student loan debt in addition to living expenses while being a full-time student at USC. He relies mainly on his leftover student loan money to supplement his living expenses.
“If I spend too much on one thing on one day, I go without lunch or dinner the next day,” Syed says. “I don’t have a safety net.”
Syed has three siblings, including an autistic sister who requires full-time care and attention. This adds to his parents’ financial burden.
“My parents can only do so much for me,” Syed says. “If I spend my money unwisely, it can put their finances under stress as well, which isn’t fair to them.”
What Does Syed Want Out Of A Banking Experience?
“I’d rather communicate with someone face to face about my finances,” Syed says.
He’s not alone. According to a Bankrate.com survey, 45% of Americans have been in a bank branch within the past 30 days. Furthermore, according to a Business Insider article, 61% visited a branch nearly three times in the past month, with millennials visiting branches more frequently than other groups.
This brings up the issue of branch locations. Branches are costly to run, but it’s also costly to lose members from inadequate coverage. Syed deals with this situation with his bank.
“The problem with my bank is there are no branches in the area, so I have to go to an ATM in a gas station or at another bank,” Syed says. “Then I have to pay a fee to withdraw or manage my money from that ATM.”
What Does Syed Think About Houses And Credit?
According to a Washington Post article, 34.1% of Americans younger than 35 own a home. That rate is 62.9% across all age groups. “This is a record low and about a fifth below its peak from the go-go years of the mid-2000s,” the article states.
For millennials looking for a stable job and balancing student loan debt, acquiring a house is out of the question. But Syed poses another reason for the low rate of homeownership.
“I’m not ready to be that independent yet, as much as I hate to say that,” Syed says. “Growing up, my parents said, ‘Don’t worry, we’ll take care of it.’ I greatly appreciate it, but it’s taken away that learning experience with owning a car or dealing with a house.”
So what does Syed know about credit?
“I don’t really know that much about it,” Syed said. “I don’t have a credit card. No one really took the time to explain it to me.”
Again, he’s not alone.
According to TransUnion, 43% of borrowers between the ages of 18 to 36 have a subpar VantageScore credit rating. On top of that, some millennials only use cash or a debit card, which doesn’t aid in building credit.
“I prefer cash or my debit card because it is what I have,” Syed said. “But if I had the option and the knowledge, I would try a credit card.”