Older generations often tell us that if we work hard enough we can achieve the American Dream — the stereotypical suburban house with a white picket fence, a spacious backyard and the promise that dedication brings success and opportunity. But with student loans, the housing crisis and inflation looming over our heads, this feels out of reach for our generation.
The foundation of the American Dream is that education is the gateway to success. The pathway is clearly laid out for you: elementary school, middle school, high school and eventually college. This path, however, increasingly creates a pile of debt rather than opportunity. In 2022, the College Board found that 51% of students graduating from public, four-year colleges in the United States were, on average, $29,400 in debt. Since the tuition and fees at private universities in the United States have increased 41% in the last 20 years and student debt is close to double the amount it was in 2008, the cost of education has outpaced inflation. In terms of their personal lives, Gen Z has faced delayed marriages, postponed homeownership and a face greater hesitation to start families due to the constraints of their debt. The burden of obtaining a degree is reshaping lifestyle choices and financial priorities in ways that previous generations never needed to consider.
Prices of groceries, rent and healthcare have become exorbitant as inflation continues to strain our economy, with prices increasing by 13% overall with the price of groceries, utilities and gas increasing 20% in the past four years. Studies have shown that of the spending categories that Gen Z and Millennials plan to splurge on, groceries are top priority over dining out or travel. The financial strains facing younger generations aren’t about reckless spending or poor management of finances, but about the system that forces us to work harder for less.
The current housing market only exacerbates the difficulties Gen Z faces, especially college students. Those trying to find housing off-campus are acutely aware that renting an apartment in New York City is a strenuous feat in itself. With the median rent in New York City surging past $3,500, students looking for off-campus housing find most apartment costs increasingly unattainable. Prices are high and landlords require high credit scores and co-signers, which a lot of students don’t have due to a lack of a credit history or parents who can co-sign. The only choice I — and many other students — have in the face of the housing market, is to share a dorm for another year or commute long distances to get to class every morning. Living with parents after graduation is another growing trend, with a 2020 article finding over 50% of young adults between the ages of 18 to 29 living in their parents houses — the highest since the Great Depression.
Even those who can meet rent requirements can be trapped in a downward financial spiral. High rent payments lead to lower savings for a future down payment on a home, making potential homeowners reliant on rented spaces for a longer period of their lives. The dream of homeownership is thus slipping away for our generation. While the precise number of New York City students experiencing homelessness is hard to pin down, a 2019 survey of 22,000 CUNY students found that 14% were unhoused during the academic year, while 55% faced other forms of housing insecurity the year prior.
A survey by Northwestern Mutual found that Gen Z is more concerned with the financial status of their prospective partners than any other generation still alive. Even though this mindset shift might not be as prominent among college students, many are struck with economic anxiety and the burnout that comes with the constant pressure to stay afloat as they struggle to balance on-campus jobs, gig work and academics.
Gen Z’s financial future relies on raising the minimum wage, creating affordable healthcare, eliminating student debt and decreasing the price of college tuition. Initiatives like former President Joe Biden’s student debt relief program, which cleared almost $600 million in student debt, have made some progress, but have not been extensive enough to financially free students or proactively make the cost of tuition cheaper.
These significant government initiatives will be slow to come by, but in the meantime, schools like NYU can play an integral role in navigating the financial world and lessening students’ financial burdens. Over 2 dozen colleges are taking on “no-loan” policies, which meet a hundred percent of students’ financial needs without any student debt in an effort to combat the crisis. It’s time for NYU to follow that example. As a part of these programs, students fulfill a work-study requirement or an on-campus job and get a complete grant in return, ensuring that their financial need is met throughout college. These programs can also slowly be eased in by initially providing loan-free education for those whose family income is below a certain amount, and eventually extending to middle income groups as well. These policies can increase and diversify NYU’s enrollment rate, making college education more affordable for those from low and middle-income families.
In addition, NYU can increase students’ financial literacy by creating programs explaining financial services and loan repayment training, especially the idea of income-based payment plan options.
For Gen Z to have a chance to be financially independent and not be held back by crushing debt and high living costs, then they need a strong foundation from which to build. With no-loan policies, robust financial education and support breaking into the job market NYU can help its students navigate the financial system as a hurdle to be traversed with practice and guidance, instead of an insurmountable obstacle.
WSN’s Opinion section strives to publish ideas worth discussing. The views presented in the Opinion section are solely the views of the writer.
Contact Shanay Tolat at [email protected].
