| Friday, June 30
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New college grads should master financial boomerang |
Watching a boomerang in operation is appealing. Unlike throwing most American projectiles, such as the baseball, football, basketball and other straight-shooting orbs, the boomerang is different. When correctly mastered, the boomerang returns to its sender. However, when picked up and tossed by an amateur, this inexperienced hurler usually fails, and the boomerang dives into the earth.
I think it's strange that my generation has been quickly related to the ''Aussie arrow'' for falling to the ground ourselves. College graduation, once the highlight to one's career and a short, unfettered road to a job, has become a time of difficult challenge for many young folks. While many (especially those in the fields of science, nursing and accounting) enjoy the delights of easily finding a job, an increasing number of young, degree-wielding adults are confronted with the snags of a highly competitive job market, debt, housing prices and the expectation of a middle-class lifestyle.
Finding that job, especially one with exceptional security, has become as elusive as finding ways to get that boomerang to return to an amateur's hand. The expectation to receive a college degree has created a multitude of people with bachelor's degrees. Meanwhile, cost-trimming, outsourcing and other elements have reduced or eliminated potential positions. In addition, colleges have begun looking at enrollment as an increasing form of profit and not as a pathway to securing a job.
Instead of counseling students on how to graduate in four years in the fields that employers seek, schools often become too fixated on the bottom line. Looking at the escalating admission numbers at any university across the United States, one wonders what happens to all of these young graduates once they exit college.
Debt. That's what happens.
The typical amount of debt each new graduate owes some lender stands at $19,000. Coupled with the average 22 year old's credit card debt ($3,000) and the inability to find a job in his or her field, young ''boomerangers'' certainly are not looking at the peachy skies promised to them. And the clouds darken the image as tuition rises every year (Pennsylvania's state-school rate is quickly approaching $10,000), state and federal grants and scholarships decrease and student loan interest rates spike from 3.37 percent to over 7 percent on July 1.
Many new graduates have ignored the portent and are looking for a way to edge the competition. This can be through non-paid internships or by enlistment in graduate, law and professional schools at an alarming rate. Thus, they accrue more debt and, as moms and dads can relate, keeps them at home longer.
In addition, the housing market has blanketed 20-somethings in more fiscal stress. The median home price is out of the reach of my generation. Across the United States, that price is at $213,000. Add $30,000 more if you plan to stay in the Lehigh Valley.
Yet, I believe that the biggest contributor to my generation's downfall is our own egocentrism. We expect to leave our parents' home and live in a roughly similar, if not better condition — with all the fixings. When a young professional lands a job, the first move is not to set up a 401(k), save for a wedding or to make investments. Rather, he or she takes out friends and buys them shots of Grey Goose all night, tosses $35,000 at a flashy car, upgrades the wardrobe and takes a vacation.
My suggestion: Learn how to properly wield the power of the boomerang. While it might plummet into the ground after the first few tosses, eventually, it will soar. However, also learn how to catch it, or it will smack you in the face, sending you back home with mom and dad — again.
source: www.mcall.com |
posted by ^%&^
@ 1:07 PM
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