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Financial Crisis May Have Hit ’80s Generation the Hardest

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  • Financial Crisis May Have Hit ’80s Generation the Hardest

    https://blogs.wsj.com/economics/2018/05/21/crisis-hits-1980s-generation/

    Thought it was of interest. Perhaps with delayed workforce entry of MDs from this generation because of training length, now just hitting the attending years, maybe this is a little less applicable

  • #2
    Saw this a couple days ago.  Good article.

    Comment


    • #3
      Can't get to the article due to the paywall so I won't be commenting on the specifics.

      Someone born in 1989 had a much different experience than someone born in 1980. People born near 1980 (me included) were able to take advantage of two market downturns (2001-2002 and 2008-2009) to start building wealth early in their careers. I was able to take advantage of both downturns to build what I consider a lot of wealth given my household salary/income.

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      • #4
        I was born in the mid 80s so I fall into the group the article is talking about. It's all relative to me. I went the traditional straight through route so I didn't really have any income to put into the recession. I'm well on my way to meeting my retirement goals while still living what I consider a cush life. Having a big shovel and relatively low expenses can overcome about anything.

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        • #5
          Good article that just kinda notes what everyone has 'felt'. Drastic inflation in education and healthcare type expenses with little gain in the wage department. Am hopeful as they mention at the end that it works out in the end due to being more productive and educated.

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          • #6
            I'm certainly feeling the student debt problem although very manageable with a big shovel and that debt is not a long-term concern.  More of a short-term annoyance.  The big thing about the millennial generation is when we were coming out of college, that's when the economy was in the toilet.  Finding jobs was hard for a lot of my friends, and many just took whatever they could find regardless of career goals.  The jobs would be low paying and usually involve long hours.  As an MD, I came out of training a couple years ago, so I didn't have the weak economy when I was looking for jobs (I don't count residency/fellowship, the availability of those jobs do not seem to correlate to the economy).

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            • #7


              That 1.5T in student debt will have to be written down
              Click to expand...


              Agree, though given the government is provider/servicer of the vast majority of student loan debt, they will try as hard as they can not to write off.  See Fannie Mae, Freddie Mac for example.  A 30% - 40% payment default rate on the portfolio would get most CEO's fired for not pricing risk appropriately.

              I certainly feel for the people born in the mid late eighties as it appears they are not catching alot of breaks financially so far.

              Comment


              • #8
                Student loan debt will have to be reorganized. Hopefully demand changes tuition prices as well.

                It makes all kind of sense to make student loan payments 100% deductible. The government is getting your taxes as a result of the education you received and all the associated other benefits. They have the long vision ability to take that side of it for the benefit of literally everyone. No need to make a burden for your country. I'd have my loans paid off several times by that measure.

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                • #9
                  Hey that's us!!

                  Luckily, we have had a series of really lucky breaks and are doing fine. Despite my future company laying of 30% of my future department, they still kept me on as an intern that summer and hired me full time the next year. Our wedding was super cheap because all the vendors were desperate for bookings. The housing crash meant we bought our home at the bottom right before the market went insane in our area. DH matched in rads during one of the least competitive years on record because the job market was so bad...and now a year out from the job search it is looking fantastic.

                  I do remember taking Finance in undergrad as Bear Stearns and Lehman Brothers were collapsing. Multiple friends had job offers rescinded. Many more lost their jobs when oil crashed a few years later. I was lucky to get the position I did. The environment and pace of work at my job was noticeably different as an intern vs post crash.

                  If anything, it was a crash course in "making hay while the sun shines" because we are well aware that it will not always be that way.

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                  • #10
                    1982 here.  I agree that my generation has had quite a different experience compared to our parents and especially our grandparents.

                    Agree with MSooner, that it seems like a lot of us have gained valuable knowledge from watching the financial crisis play out. We're also watching the decline of decency in American politics and are (hopefully) becoming acutely aware of the importance finding a way to protect our democracy from becoming completely corrupt.  Not to mention the problems we now face with climate change and the enormous burden that will place on our generation in the near future.  It really feels like we were handed a hot mess when you compare us to the boomer generation.

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                    • #11




                      Can’t get to the article due to the paywall so I won’t be commenting on the specifics.

                      Someone born in 1989 had a much different experience than someone born in 1980. People born near 1980 (me included) were able to take advantage of two market downturns (2001-2002 and 2008-2009) to start building wealth early in their careers. I was able to take advantage of both downturns to build what I consider a lot of wealth given my household salary/income.
                      Click to expand...


                      Here is a free copy of what I assume is a similar article

                      https://slate.com/business/2018/05/millennials-are-in-a-deep-financial-hole-compared-to-past-generations.html

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                      • #12
                        Who else memorized all the lyrics of Billy Joel's We Didn't Start the Fire as a kid?  I always think of that song when someone tries to say that one generation has it easier or more difficult than another.  One could also argue that having a recession during one's 20s may also improve their spending and saving patterns and learn to live more frugally, which may benefit them later.   It was also a great time to buy one's first home, assuming one had the ability to get a loan to do so.  I do think student loan debt is out of control for people in their 20s and 30s in a way it was not for previous generations.

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                        • #13
                          Yeah, I feel like this doesn't really apply to docs. I was a med student in 08. The market had no effect on me whatsoever, as I had nothing in it, and there were not cuts in residency spots as a result so no effect on matching in 2010.

                          Now people who took out tons of loans for a private education for a degree that ended up not being very helpful in terms of employment- they were hosed. I think the good thing about all this attention is that hopefully people in college will pay closer attention to costs and employment opportunities, and maybe not jump into grad school which may not be helpful, just because they're not sure what to do after graduation.

                          Comment


                          • #14




                            Yeah, I feel like this doesn’t really apply to docs. I was a med student in 08. The market had no effect on me whatsoever, as I had nothing in it, and there were not cuts in residency spots as a result so no effect on matching in 2010.

                            Now people who took out tons of loans for a private education for a degree that ended up not being very helpful in terms of employment- they were hosed. I think the good thing about all this attention is that hopefully people in college will pay closer attention to costs and employment opportunities, and maybe not jump into grad school which may not be helpful, just because they’re not sure what to do after graduation.
                            Click to expand...


                            You still paid far higher than prior generations for schooling, and though residency wasnt hard to find, jobs outside were likely harder to find and less overall pay/benefits if you came out after the gfc. In my more economically sensitive field there were very very few jobs at all. Now there are tons.

                            Comment


                            • #15
                              As one born in 1980 I can agree.  Graduated during the 2001-2002 recession.  Moved to Arizona and bought a house right before the housing crisis hit and lost 50% of my home value in a year.  It was a tough time and a lost decade as far as investment returns go.

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