Sarah Lawhead wakes to the smell of coffee and the sounds of her husband, Jason, and roommate, Dwayne, getting ready for work. She bids them goodbye as she fights the urge to climb back in bed. She has a busy day ahead of her: grocery shopping, laundry, and the never-ending job hunt.

 

Sarah, 27, is just one of the millions of Millennials with advanced degrees who are unemployed. Despite the hard work it takes to complete a master’s, Millennials with master’s degrees face some of the harshest economic challenges in America.

 

The reality of the job market beyond the safety of a master’s program are sobering. According to the Bureau of Labor Statistics, Millennials with master’s degrees face an unemployment rate of 17.2%, over 6.5% higher than the unemployment rate for those with undergraduate degrees. (Sutton, 2014). Sarah has applied to over 200 jobs in the past two years, with no success.

 

“It makes no sense,” she said. “I was told over and over again I wasn’t qualified because I didn’t have experience, but then I was told I was overqualified for a part-time position to stock books at the library.”

 

Americans most often hear about the staggering undergraduate student loan debt, but the rising cost of graduate degrees is just as stunning. According to a study by Edvisors, nearly two thirds of those who pursue master’s degrees end up with an average student loan debt of $41,400. This kind of debt can cause Millennials to stall on major life events like purchasing a house. In fact, between 2009 and 2012, homeownership rates for homebuyers with student loan debt fell two times more than the amount for those without student loan debt (El Bogdhady, 2014). Sarah and Jason recently purchased a condominium, but they still feel the bitter sting their student loan debts had on their housing choice.

 

 “It would have been nice to buy a house,” Sarah said. “But even with Jason working, and having a third person to split the bills with, we still had to sell a car to afford the down payment on the condo.”

 

Young adults also have a strange relationship with credit cards. Millennials are less likely to have a credit card than older generations, but those who do still dedicate large sums of their paychecks to credit card debt. Six out of 10 Millennials do not have a credit card (Yerak, 2014). However, those who do use plastic spend a large chunk of their money on the bill. Millennials dedicate 16% of their monthly pay to credit card payments (Wells Fargo, 2014), and those payments normally aren’t enough to pay off the balance.

 

 

“We have five credit cards,” Sarah said. “We had to live off them during school, and now we are working on getting out from under them so we can get rid of them.”

 

Despite the tough times, Sarah and Jason, like many Millennials, find ways to make ends meet with a little left over, and are looking forward to the future. Young people are very resourceful at finding deals, from splitting rent to shopping at discount stores. They also use technology to help them find the best deals.

 

Although an estimated 25% of Millennials live alone, 58% live with a significant other, 9% live with a roommate, and 8% still live at home with their parents. Sarah and Jason have both avoided moving in with their parents, but they have been part of the shared-housing market since graduation. Sarah’s youngest sister lived in the basement of their townhouse apartment for a year, and their current roommate, Dwayne, moved in after she moved out.

 

“It would be nice to have our home to ourselves,” Sarah said. “But right now, we can’t afford it.”

Sarah and her husband are working diligently to save money for the day they no longer need a roommate, as well as setting aside money for emergencies and retirement. One major way Sarah saves money is shopping for inexpensive groceries.

 

“We get almost all our groceries at Aldi,” Sarah says. “You can get so much more than you can at Kroger or Giant Eagle for a fraction of the cost.”

 

Shopping at discount stores is a growing trend among Millennials, and not just grocery stores like Aldi. In fact, Millennials tend to gravitate toward resale communities, but the purchases they do make have to be durable. In fact, many retailers are “de-branding” their products to enable them to stay in style for longer.

 

Smartphones and other digital devices also make it easier to save money, or at least to not spend as much. Millennials use technology to find the best deals at stores, from digital coupons to researching which store sells a big-ticket item for less (Suddath, 2014). Many stores, like big-box retailer Best Buy, will work with the customer on the price of an item if a customer finds it at a better price online. Other stores, like Kohl’s, Target and Kroger offer exclusive discounts and the ability to add digital coupons onto loyalty cards through their mobile applications.

 

Sarah sees these conveniences as lifesavers, and she remains optimistic about the future, despite the tough times.

 

“I think we’ll be fine,” she said. “We’ve learned how to save for now, and at least Jason’s paying off.”

 

 

 

References

 

El Bogdhady, D. (2014 February 23). The washington post. Student debt may hurt housing recovery by hampering first-time buyers - debt and the first-home buyer - student loan burden could put the brakes on housing market's recovery. Retrieved from http://infoweb.newsbank.com.proxy-library.ashford.edu/iw-search/we/InfoWeb?p_action=doc&p_topdoc=1&p_docnum=1&p_sort=YMD_date:D&p_product=AWNB&p_text_direct-0=document_id=(%2014C29D405D428E08%20)&p_docid=14C29D405D428E08&p_theme=aggdocs&p_queryname=14C29D405D428E08&f_openurl=yes&p_nbid=U5AR57VMMTQxMzI0OTAyNC44NTIyNjk6MToxMDpFQlNDTzE3OTcy&&p_multi=LHLB

McGrath, K., Rodriguez, J. (2013, July 2). Young people shred card debt, pile on student loans. [Infographic]. Retrieved from http://www.creditcards.com/credit-card-news/millennials-swap-credit-cards-student-loans-1701.php

 

Suddath, C. (2014, April 25). The Millennial Way of Shopping: More Careful, Durable, and Frugal Than You Think. Retrieved October 13, 2014, from http://www.businessweek.com/articles/2014-04-25/millennials-are-careful-frugal-shoppers-who-buy-for-the-long-term

 

Sutton, D. (2014, September 28). 7 reasons millennials are unemployed and living at home. Retrieved October 13, 2014 from http://national.deseretnews.com/article/2435/7-reasons-why-millennials-are-unemployed-and-living-at-home.html#C70I5KCPuWXWxeEO.99

 

Wells Fargo (2014). Eight in ten millennials say great recession taught them to save “now,” wells fargo survey finds. Business Wire. Retrieved from http://www.businesswire.com/multimedia/home/20140610005999/en/

 

Yerak, B. (n.d.). 6 in 10 millennials don’t have a credit card. Southwest times record. Retrieved from http://infoweb.newsbank.com.proxy-library.ashford.edu/iw-search/we/InfoWeb?p_action=doc&p_topdoc=1&p_docnum=1&p_sort=YMD_date:D&p_product=AWNB&p_text_direct-0=document_id=(%20150558A887803E08%20)&p_docid=150558A887803E08&p_theme=aggdocs&p_queryname=150558A887803E08&f_openurl=yes&p_nbid=A55E52JHMTQxMzI1MDc1OC43NzEyMjY6MToxMDpFQlNDTzE3OTcy&&p_multi=STRF