Financial Behavior, Debt, and Early Life Transitions

This study, funded by a NEFE grant to The Ohio State University, follows the 1997 Cohort from the National Longitudinal Survey of Youth to explore financial behavior, debt, and early life transitions among young adults coming of age in the 2000s.

Young adults—specifically the oldest Millennials born around 1982—face distinctive challenges and financial concerns as they come of age, enter employment, and form families. With typically modest incomes and minimal wealth, young adults often must take on debt to finance investments in the future. This debt has a dual nature: It can be both an accelerator and a deterrent to major life transitions and milestones.

Analyses of the National Longitudinal Survey of Youth 1997 Cohort (NLSY97) and the Survey of Consumer Finances (CSF) reveal how Millennials’ life decisions are shaped by debt as they pursue multiple paths to adulthood. Ultimately, it finds that young adults’ relationship with debt is complicated and reflects the fact that debt is a double-edge sword: Debt facilitates opportunity but can lead to emotional or financial strains and delay family formation.

This examination of the financial lives of Millennials in the early 2000s is offered as both a snapshot in time and as a starting point to begin to understand more about how young adults engage credit in challenging times and how debt affects their lives.

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