According to a new study published recently, it has shown that younger Americans have a lot more credit card debts than the older generations. But what is interesting is that the older Americans seem to encourage their children to use credit as a ‘safety measure.’
These facts came to light after these studies were conducted on 27 white American populations who were from the middle income category. The researchers from Ecole des Hautes Etudes Commerciales du Nord of France, Lisa Penaloza, and Michelle Barnhart of Oregon State University wanted to get an insight into the attitudes, cultural meanings, and perceptions behind how the American population views credit and debt which may have contributed to the recession in some way.
The details of the interviews that were conducted would be published in the Journal of Consumer Research in their December issue. These interviews with the participants are presently available online.
According to Barnhart, the recession was not just because people were greedy or dumb but due to their compelling lifestyles where people lived way beyond their means.
Americans spent around 9.3% of their income paying off debts in the year 2008. In 2010, there were more than 24% of the families in the US alone who had mortgages owing to more than what their homes were worth. Going by the interviews that were conducted before the 2008 recession, researchers found out that though the consumers agreed in principle that they should cut down on their debt, they took on significant amounts of debt because this was just their normal way of life. As one of the participants had put it aptly ‘taking debt was the American way of life.’
There are a few key findings from the research and they are: