Almost certainly. I think you’ll look in vain for a time when any large number of college graduates tended to be deeply concerned about long-term financial considerations.
This was of less concern when getting heavily into debt by age 22 simply wasn’t an option. Now, it’s common.
I tend toward advice given on SDMB to the effect that you should buy nothing on credit that you can’t reasonably expect to return more than its cost - which excludes essentially all vehicles.
So your first car will probably be some hand-me-down rattletrap that you’re more or less embarrassed to be seen in. By the time it gives out you’ve saved enough for something a bit better. By the time you can afford a new car, you may well have seen that there are better things on which to spend your money.
That can backfire, though. My first car was a Fiat 128 wagon, that my parents bought used from friends.
It spent as much time in the shop as on the road. Every time I started to save up a few dollars that MIGHT have helped replace it, the damn thing developed another problem requiring a 300 dollar repair. I was finally able to replace it, with a car that, yes, I took out a car loan to buy, and the cash flow improved dramatically.
So, while it’s not bad advice in general, the rattletrap may be a worse option that financing a car.
Can’t completely argue with the 3 year loan cutoff though. I’ve had loans with longer terms than that, but so far have always managed to pay them off faster. I hate having a car payment.
Do you mean to say never be upside-down on your car loan (owe more on the car than it’s worth)?
I usually try to counter this by having a large enough down payment that this never happens. e.g. have $5K down on a $25K vehicle with a 48 month loan.
No, I’m saying never take out a loan to buy a car - pay for it outright.
My suggestion: buy a $5k vehicle.
I have seen some studies that show when you take into account all the costs of a college education including tuition, books, housing and opportunity costs, over a lifetime it’s only a gain of a few percentage points over just havning a high school education. Of course what those studies don’t show are the intangible benefits of having more choice over the types of jobs you can get.
Is debt a huge problem in the UK? I have never lived overseas, but my impression as someone in the US is that a good deal of debt here can be traced back to medical care or tertiary education, both of which are either covered or less expensive in the UK than they are here.
If debt is a huge problem in the UK, where is it coming from? Is it the real estate boom, consumerism, divorce, stagnant wages and job losses or something else? Is your public tertiary education not as heavily subsidized as I thought (I have a friend in London who said it wasn’t too expensive)?
As far as ‘should debt be shamed’, I think there should be an awareness that debt is good for debt companies and companies in general because the further in debt you are the more desperate you become for a job and the more fees and interest can be charged to you. So yes, in that regards debt should be shamed because higher debt means you are easier to control and pump for money (via fees and interest charges). But it can’t always be avoided. I think most debt comes down to job losses, family break ups or medical problems. And none of those is really something people need to be shamed into going into debt for.
Different numbers give you different figures for the “no debt at all group” ranging from ~24-30% which vary depending on if they’re using figures to indicate just those who no credit cards at all vs who has no cards and those who have them but do not use them. However, the pay off by the end of the month rate of 30% is pretty static. Here’s one article, another, another about the average amounts of people who do have debt.
I’m not sure I agree that that benefit is as great as you imply - my husband had a choice of jobs with his Bachelor of Arts degree - painting or working at McDonald’s. At the other end of degrees, someone with a degree in Archaeology (as mentioned already) has an extremely limited choice of jobs in the entire world. There are many people with high-level degrees who have to move anywhere in the world to get a job in their field (Jim has lost two friends to this - one in Switzerland and one in New Zealand).
Either the study you’re talking about didn’t take it into account or you didn’t mention it, but by those standards, I’d say having a technical diploma puts you ahead of the game, then - minimal debt, high earning potential, many jobs in many fields in your local area. The reality in North America, too, is that skilled jobs are going to go up in demand in the next couple of decades like a rocket. If I had kids, I’d be steering them away from college degrees.