May 16, 2022
By: Freedom to Prosper Team
For each generation, building wealth in the U.S. has been historically tied to becoming a homeowner. Homeownership is one of the few sure ways families can enter the middle class and gain economic mobility. However, homeownership is becoming far out of reach for most Americans, especially for Millennials and those tied down with student debt.
Research shows that low rates of home ownership is largely due in part to high levels of student debt. In the past 12 years, student loan balances have quadrupled and is now the second largest form of household debt, behind only home mortgages.
These monthly loan payments serve as a significant barrier towards building wealth. Higher loan repayment burdens make it increasingly difficult to build savings, accumulate assets, and spend money in the economy in general. The Boston Home Center conducted a survey, revealing that student debt and credit scores were the two largest barriers to purchasing a home.
Student loan borrowers will greatly benefit from debt cancellation, alleviating financial burden and supporting graduates to become first-time home buyers. Student debt cancellation will free up millions of Americans to gain stronger financial security and family stability, by increasing their chances to buy homes and build intergenerational wealth.
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