Everywhere we turn, we hear a lot about various generations, wether its Boomers or Millennials. Now, however, there’s a new type of generation called the “sourdough generation.” And it seems they are having the most financial difficulties in this ever-changing economic landscape…
The Sourdough Generation
So, what is the so-called “sourdough generation?” Well, they are usually Generation Xers. More specifically, they are troubled parents who, unfortunately, need to care for their families far longer than other generations. These moms and dads are still paying their own college debt, while taking care of both their parents and their children. Some are even paying back college debt while sending two or three children to university themselves! The name “Sourdough Generation” comes from the fact they are soaking up all the costs of their family.
“As parents, we assume these responsibilities to make things easier for our children, but paying a mortgage, cars, our own parents’ expenses can make things seem burdensome at times,” 48-year-old Saideh A. Brown, the chief executive officer at Global 50, says. “I am blessed, and I have a wonderful husband, but this is a larger financial issue that many want to admit.” Statistics say that American citizens age 50 and older owe a total of $289.5 billion in student loan debt. Now, add on all the other bills they have! Quite a sum, isn’t it?
So, what can members of the Sourdough Generation do to help themselves?
How To Deal With Student Debts With Dependents
- Cut Expenses: This point is the most obvious. Still, it’s always mentioning! There’s more to saving than not taking a vacation, hower. Think about asking members living at home, whether children or parents, to take up a part-time job or freelancing. It might push people out of their comfort zone, but they’ll eventually find the extra money more than worth it.
- Search For A Payback Plan: Think about checking out what the government calls “income-based repayment plans.” “These plans allow borrowers to cap their student loan payments at 10%-to- 15% of their discretionary income,” said TheCollegeInvestor.com founder Robert Farrington. If you’re interested in seeing if you qualify, read more about these plans here.
- Forget About Savings: There are many ways to get some extra cash: inherited money, side jobs, raises, and so on. However, while saving it for a rainy day might seem like the right choice, think again. Putting it towards your loans or bills will allow you to pay them off sooner!
- Think About The Consolidating Student Loan: Consolidating student loans comes with some serious pros. The loan and payment become more flexible, meaning more monthly savings, and can help you pay back loans faster or achieve smaller payments. “Moving to a fixed rate from a variable rate allows borrowers to know exactly what they are expected to pay monthly,” said the VP of consumer loans and loan administration for Affinity Federal Credit Union, Theresa Williams-Barrett.
Most importantly, just remember that paying back the loan is not as hard as it often seems at the start. Creating a solid plan and contacting your financial advisor will make your goal arrive sooner than ever.
Sources: CNBC, Finance101