Parental alert: Your debt-laden child is eyeing your basement

Parental alert: Your debt-laden child is eyeing your basement
Large chunk of students borrowing money for college plan to move back in with mom and dad, survey reveals
MAY 17, 2012
More than a third of Americans owe at least $1,000 from their college years and about 17% have at least $10,000 to repay from student loans or other borrowing they took on while pursuing a college education. And a great many are planning on moving back in with their parents once they graduate. While 35% of respondents to a new survey said they had at least $1,000 in college debt, 7% said they have $30,000 or more. About 10% of the 774 people interviewed from Generation Y, those under age 31, owe more than $30,000 from their college years. “Over the course of the economic trouble we've been through the last several years, people's ability to save for education may have gone away,” said David Shapiro, senior vice president of Western Union Payments, which sponsored the study. “More people are taking out loans because they see how valuable education is and so are leaving school with a great deal of student loans.” The education debt affects students' college years and those immediately following graduation. About 21% said their grades have suffered because of the amount of debt they owned, and 12% of students said they “may not graduate” because of the amount of their debt, suggesting they may have run out of money and are ineligible for any more loans, Mr. Shapiro said. About a quarter of students who will have student loan debt on graduation said they are mostly likely going to move in with their parents and another 3% plan to move in with relatives, according to the survey. “It all points to a lot more financing of education and a difficult financial situation when you get out into the workforce,” Mr. Shapiro said.

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