Tuesday, October 7, 2008

Generation Debt

I don't normally watch "60 Minutes", but due to various circumstances I saw the episode last Sunday on "Generation Debt" ... (full transcript at http://sixtyminutes.ninemsn.com.au/article.aspx?id=640543).

Basically it was a report on the Gen Yers (those aged between 18 & 28) who between them hold $60BILLION dollars worth of debt in AUSTRALIA ... now, i'm not sure how many Gen Yers there are, but we've only got a total population of 20mill or so, so i'm thinking there can't be THAT many of them.

I know some of the debt is HECS (higher education costs) and i am a bit annoyed that the program didn't differentiate between how much of the $60Billion is HECS and how much is "other" debt. Even so I was totally astounded at the "it's the price I pay for happiness" type attitude that came through the whole report.

Peter Overton was the reporter and I thought he did a pretty good job except I would have liked to punch him for two comments ... both were made in relation to a 21y.o. lass who has a personal debt of $70,000 ... he called her a "poor possum" in one comment - I would have thought "stupid idiot" would have been more applicable and then at the end he said "you can't help but admire her decision to pay back what she owes". Umm, hang on a second ... why should anyone ADMIRE someone for doing what they're responsible for???

One of the interviewees - who annoyed me the most with her attitude - played the "victim" card, e.g. "We're targets. We are targets of the bank because they know we're gullible. They know that anything they say we'll just follow. They're the leader and we're just the little people walking behind them, 'give me the money.'"

Her attitude doesn't come across in the transcript as much as it did in the video - where she says ... "it's my debt I'll deal with it and if I can't afford it then I will just... go bankrupt" .. the "go bankrupt" bit was said with a off-handed laugh ... as if it is a joke ...

All in all I thought the whole report highlighted a very scary situation and as a mum of two young girls I'm now asking myself how I can avoid my girls growing up with similar attitudes. I use my credit card a lot, and my girls know this, what they probably don't know is that I pay it off in full each month. For me, a credit card isn't "free, easy money" it's a convenient way of avoiding carrying cash.


Somerled said...

I have a 16-year-old son and a 14-year-old daughter. It seems as if the world is devoid of reason. I do my best to spend time with them each day. Dinner time is like an after-action report. We share, we analyze what has taken place, and plan for the future.

I talk to them about hidden costs. Nothing is "free". Going in debt to obtain disposable property or a home that rivals the neighbor's doesn't produce anything beyond a temporary glow of happiness followed by long-term stress and misery.

If my children grow into young adults believing they're entitled to goods, services and real property beyond their limits to pay, I'd say I had failed them as a parent.

When families fail, societies fail.

Anonymous said...

It is sad that we have reached a point in society where paying back what you owe is 'admirable'. No wonder the world in in crisis.

ravenshrike said...

Once they hit puberty go over your non-sensitive credit statements with them once a month or so. Also show them what would happen if you didn't make payments and how fast the debt would pile up.