Young Adults Feel Empowered by Debt


NEW YORK (MainStreet) —A new study set to be published in Social Science Research found that young adults age 18 to 27 actually feel empowered by their credit card and student loan debt.

Researchers at Ohio State University analyzed responses from 3,079 young adults age 18 to 34 nationwide as part of the bi-annual youth survey conducted by Ohio State's Center for Human Resource Research. The study found that the more debt these young respondents carry, the higher their self-esteem became and the more they felt in control of their lives.

The results of the survey weren’t completely unexpected. The researchers had assumed student loan debt would have a positive connotation since young people tend to associate getting an education with bettering themselves.

"Young people seem to view debt mostly in just positive terms rather than as a potential burden," Rachel Dwyer, lead author of the study and assistant professor of sociology at Ohio State University, explained in a press release. "Debt can be a good thing for young people – it can help them achieve goals that they couldn't otherwise, like a college education.”

But she admitted the enthusiasm for credit card debt was a surprise.

"We thought educational debt might be seen as a positive because it is an investment in their future, while credit card debt could be viewed more negatively," she said. "Surprisingly, though, we found that both kinds of debt had positive effects for young people. It didn't matter the type of debt, it increased their self-esteem and sense of mastery."

Researchers offered several explanations for the credit card feel-good phenomenon, such as educational expenses like textbooks or tuition costs that would carry the same connotations of “bettering one’s self” as a student loan.

The researchers also explained that these young adults might be enjoying their debt because it has allowed them to buy the things they wanted without having to wait, though the data did not support this.

Still, the researchers were torn over whether the study’s results had negative implications for America’s youth.

“Debt may make young people feel better about themselves in the short-term, but that doesn’t mean it won’t have negative consequences in the long-term,” Dwyer said. “We found that the positive effects may wear off over time, but they still have to pay the bills. The question is whether they will be able to. There needs to be additional research to answer this question.”

The study certainly found that some participants riding a debt “high” were not in any position to pay it off.

Those in the lower classes felt the largest self-esteem bump from their credit card and/or student loan debt, while middle-class young adults felt no different with their student loan debt, seeing it as such a commonality among their peers that it’s almost considered normal. This group did feel better about their credit card debt, however.

Young adults from affluent families felt no different with any kind of debt.

"The groups that most need the debt – the middle and lower classes – get the most benefits to their self-concept, but may also face the greatest difficulties in paying off what they owe,” Dwyer added.

The positive feelings toward debt may not last long, found the study, as those aged 28 to 34 displayed more stress about the money they owe.

"By age 28, they may be realizing that they overestimated how much money they were going to earn in their jobs,” Dwyer said. “When they took out the loans, they may have thought they would pay off their debts easily, and it is turning out that it is not as easy as they had hoped.”

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at

Show Comments

Back to Top