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Youth's Whimsy Sows Seeds of Debt

Thursday, March 31, 2005;

The German poet Johann Wolfgang von Goethe said, "To become aware in time when young of the advantages of age; to maintain the advantages of youth in old age: both are pure fortune."

How fortunate -- and fortune bound -- many of us would be if we learned while young the importance of saving more and spending less. It's saving while we are in our younger years that gives us more opportunities to live life better as we get older.

_____Color of Money_____
Ways to Make Sure You Can Pay for the Golden Years (The Washington Post, Apr 14, 2005)
Retirement Savings By the Book (The Washington Post, Apr 10, 2005)
Read Michelle's Past Columns

It's that sentiment I had in mind when I chastised college students who borrow money to finance spring break trips when they already have enough student loan and credit card debt to burden them financially for decades. Missed that column? Here it is -- "On Spring Break, With Their Heads in the Sand."

The responses from readers (many of them college students) were very enlightening. So much so that I wrote a follow up this past Sunday -- "Youth Is Fleeting, But Debt Isn't"

Sunday's column spurned another round of reader debate. Indeed, one e-mail I received -- from a New Orleans woman who asked that I withhold her name -- is something I think you should pass on to any young person you know. Here's what she wrote:

"I just graduated from college less than a year ago, and I already regret some of the loans I took out (some that I may very well have been able to do without). I have a job I enjoy, but it does not pay me nearly what I expected. Part of it is due to the trouble our economy is experiencing and part of it is because everyone tells you that you'll make so much more with a college education. People assume that $50,000 worth of debt will be easy to wipe out mainly because they anticipate making at least that much after college. They are wrong. They don't know that they will be able to find any job immediately after college, let alone one that will pay them enough to eliminate their debt in a couple of years.

"Thank goodness I haven't racked up that much debt, but I'm already feeling the strain of bills and I'm not even out of my [student loan] grace period yet. Anyway, who says you have to spend a few thousand dollars on memories? I have many fond memories with my fiance, and most of them include simple things like walking along the river and having picnics in the park. You are right Michelle; life doesn't end at 23 or 25. I think I'll enjoy Europe a lot more in the next few years, especially once I can afford to go without adding to my debt."

This issue is such an important one that I don't think enough can be said about it. Too many young people rack up debt without much thought as to how it can adversely affect their lives for years to come.

Come Chat With Me About Retirement -- Today at Noon ET

Please join me online today at noon ET to discuss the Color of Money Book Club selection for March. We'll be talking about retirement planning -- or the lack thereof. This month I selected "The New Retirement: The Ultimate Guide to the Rest of Your Life" by Jan Cullinane and Cathy Fitzgerald (Rodale, $19.95).

Co-author Jan Cullinane will be my guest. If you can't join us at noon, please submit a question or comment in advance.

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