Magazine article USA TODAY

The Educated Prove Not So Dollar Smart

Magazine article USA TODAY

The Educated Prove Not So Dollar Smart

Article excerpt

Before the financial crash of 2008, it was highly educated Americans who were most likely to pile on unmanageable levels of debt, suggests a study from Ohio State University, Columbus. Overall, the percentage of those who were paying more than 40% of their income for debts like mortgages and credit card bills increased from about 17% in 1992 to 27% in 2008.

College-educated people were more likely than those with high school or less education to be above this 40% threshold--considered to be a risky amount of debt for most households.

The association between more education and higher debt was true even after taking into account the fact that people with education tend to have higher incomes.

In addition, those who reported being more optimistic about the future of the economy for the next five years were more likely to have a heavy debt burden. "People who piled on debt may have been too optimistic about their economic future, but you can't blame that on a lack of education," says Sherman Hanna, coauthor of the research and professor of consumer sciences. …

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