Working hard … yet hardly getting ahead.

Many full-time workers in the 25-35 age group with college training don’t need reminding that they’re struggling to balance paying for student loans while at the same time attempting to have decent housing and handling their day-to-day expenses.

I’m not in that age group, but our two children are – and I can see from their friends and work colleagues just how much of a challenge it is for many of them to balance these competing necessities.

One way to deal with the challenge is to settle for the sardine-like living arrangements one encounters in quite a few urban areas, with anywhere from three to six people residing in the same (medium-sized) apartment or (small) house.

Somehow, things just didn’t see so difficult for me “back in the day.” Of course, the entirety of my student loans following college amounted to a monthly payment of $31.28, with seven years to pay it off.

First apartment — a $185 per month rental.

And my first apartment – a one-bedroom flat in an elegant 1920’s building, complete with a beautiful lobby and old-fashioned glam elevator, cost me a mere $185 per month.

Not only that, it was only a five-minute bus ride to my downtown banking job.

Now, a newly released analysis published by the American Consumer’s Newsletter helps quantify the different reality for today’s younger workers.

What the data show is that a college degree does continue to provide higher earnings for younger workers compared to those without one.

But … it also reveals that adjusted for inflation, their earnings are lower than their college-educated counterparts in the past.

According to a National Center for Education Statistics analysis as published by the AC Newsletter, here’s a summary of the median earnings differences for male full-time workers in the 25-34 age cohort, comparing 2016 to the year 2000 in inflation-adjusted dollars:

  • Master’s or higher degree: $71,640 … down 6.4% from 2000
  • Bachelor’s degree: $56,960 … down 8.8%
  • Associate’s degree: $43,000 … down 11.8%
  • Some college, but no degree: $37,980 … down 14.3%
  • High school degree: $34,750 … down 13.6%
  • High school dropout: $28,560 … up 2.8%

Thus, among full-time male workers across all education levels, only high school dropouts have experienced a real increase in earnings between 2000 and 2016.

Among female workers, the trends are a little better, but still hardly impressive – and they also start from lower 2000 income levels to begin with:

  • Master’s or higher degree: $57,690 … down 0.5% from 2000
  • Bachelor’s degree: $44,990 … down 7.5%
  • Associate’s degree: $31,870 … down 12.0%
  • Some college, but no degree: $29,980 … down 13.8%
  • High school degree: $28,000 … down 7.2%
  • High school dropout: $21,900 … up 5.0%

What’s even more challenging for workers carrying student loan debt is that those debt levels are higher than ever – often substantially so.

According to a Brookings Institution comparative study, fewer than 5% of students leaving school in 2000 carried more than $50,000 in student loan debt. In inflation-adjusted terms, by 2014, that percentage had risen to ~17%.

Looked at another way, ~40% of borrowers are carrying student loan debt balances exceeding $25,000. It doesn’t take a finance whiz to figure out how big of a hit that is out of a worker’s paycheck.

It makes the some of today’s realities: people living at home longer following college; having frat- or sorority-like living arrangements; putting off plans to purchase a home, or even putting off marriage plans – all the more understandable.

And I’m not exactly sure what the remedy is, either. When it comes to overburdened education debt, it isn’t as if people can go back and rewrite the script very easily.

Saving for college: Millennial parents seem to have figured it out better.

sfcRecently SLM Corp. (aka Sallie Mae) released the results of a survey of parents that asked about how they’re saving for their children’s college education. The survey, which was conducted for Sallie Mae by research firm Ipsos Public Affairs, uncovered some pretty interesting stats.

Here’s something that surprised me: When it comes to saving for kids’ college tuition, it turns out that Millennial parents – those age 35 and younger – have already saved significantly more than their GenX counterparts.

Millennial parents reported having saved more than $20,000 toward kids’ college, whereas GenX parents – those between the age of 36 and 51 – have saved only around $18,000.

What’s up with that?

The report lists several possible explanations. First, Millennials are more likely to have started saving earlier for their kids’ college education because of their expectation of having paying a higher share of college costs compared to older generations of people

Likely, their remembering their own (more recent) college experiences.

Here’s another contributing factor: Many GenX parents tended to be hit harder financially than Millennials during the recent recession.  They’re the ones who were more likely to have lost a job further into their careers, when it’s can be more difficult to bounce back quite as easily and at the same level of salary.

At the same time, it’s often the GenXers who have higher mortgage and other debts already racked up when compared to Millennials.

Under those circumstances, saving for children’s college is a commitment that’s much easier to place on hold until other, more pressing financial matters are dealt with.

On the other hand, for Millennials the recession caught them at the beginning of their careers when fewer financial commitments (other than student loans) were yet made, and their flexibility more fluid.

It’s easier to roll with the punches when you don’t have a pile of fixed financial obligations already hanging over your head.

Another factor the Sallie Mae/Ipsos report cites is that GenX parents are more likely to have become over-leveraged in their personal finances — a situation exacerbated by income stagnation, declining stock investment values and declining home values (even being underwater on home mortgages in some cases).

It seems that all of these factors have colored GenX attitudes about saving for kids’ college education in ways that go beyond what the raw numbers show. When asked how confident they feel about being able to meet the college financial obligations for their children, 32% of Millennials stated that they felt quite confident.

But among GenXers, it was just 17%.

Overall, this doesn’t paint a very pretty picture for GenX parents.  But it seems that the Millennial generation has figured out the “college cost recipe” a little more successfully.

For more “topline” statistical findings from the survey, click or tap here.