A debt counselling service has warned of an increase in the number of college graduates being forced to move back in with their parents because they are loaded with debt and cannot find a job.
The national unemployment rate for 20- to 24-year-olds has dropped from 17.2 percent a year ago, to 14.9 percent today, but is still well above the rates for older people.
Consolidated Credit Counselling Services said that around one in five calls were coming from college graduates with significant debt and no job.
Howard Dvorkin, founder of Consolidated Credit, said the agency was hearing from parents and college graduates with concerns over joblessness, outstanding credit card debt, and student loan debt.
These were “putting both the graduate and the parents in a difficult financial situation,” he said.
“There is an anxiety associated with being educated and jobless,” he said.
“There is guilt about taking financial support from already struggling parents coupled with the worry of not being able to pay thousands of dollars in student loans.”
One way college grads can get on top of their debt is to establish a strong financial literacy by conducting a budget analysis.
“It’s a simple but powerful way to make sure that you control your money – and not the other way around,” said Dvorkin.
He has four helpful tips for college graduates burdened with big debts:
1.Conduct a budget analysis to get a clear idea of their current financial situation
2.Stay on top of student loan debt by getting a hardship deferment or paying even small monthly amounts.
3.Get a grip on unsecured debt by avoiding using credit cards and negotiating a better payment plan on current credit card debt
4.Be persisting in finding work
Dvorkin said: “Young people have to take charge of their personal finances regardless of the sluggish economy by going over their expenses and eliminating unnecessary spending in an effort to meet their current obligations and be aggressive when working to find a job or make more money.”