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Millennials Are Getting Ripped Off on Rent and Student Loan Debt. Here's Why We Should Free Ourselves.

by Emma Thieme Oct 3, 2016

BEFORE YOU EVEN BEGIN TO READ THIS ARTICLE, just take a moment and try to add up how much money you’ve spent on rent in the past 5 years.

Five years ago I had just graduated from college and moved into a bedroom with my friend Daniela near Acadia National Park. From there, I went on to live in 6 different scenarios. The cheapest rent I paid was that first bedroom that I shared with D, it was $300 a month. The most expensive rent came a couple years later — $650 for a lofted bedroom with no door in a white-washed brick building in Portland’s East End. When I add up those two payments, plus all the others I made in between, I’ve probably spent about $43,000 on rent since I graduated. And that figure is probably low if you’re reading this in San Francisco or Manhattan.

Forty-three thousand dollars would have paid for my entire state college education, with enough money left over to backpack through Southeast Asia indefinitely. That sum could have paid off all of my existing student loans twice. It could have bought me a fixer-upper house somewhere down south, a 2015 Airstream Bambi or this motorcycle that can transform into a jet ski.

Instead, it went to various landlords’ bank accounts.

I’m not arguing that paying rent was a mistake. That money I spent ensured that I wouldn’t need to be tied down by something permanent and that I was free to figure out what kind of lifestyle I actually wanted to lead and take advantage of any job opportunity that came along.

When it comes to renting a living space, it seems like a lot of people within my millennial generation don’t really have an end game.

However, when it comes to renting a living space, it seems like a lot of people within my millennial generation don’t really have an end game. When I bought a piece of land this past spring, I basically went against all the claims that had been made about the rest of my generational group.

There are 92 million millennials in the United States, we’re bigger than any other generation that came before us. It seems like with that amount of weight, we’d have a lot of power to demand better student loan terms, more reasonable wages and lower rental costs. But we’re actually pretty weak when it comes to that stuff.

Those of us who could afford college, have at least $21,000 in student loan debt. We graduated during the recession, and it’s not like the job market has really recovered, so today, there still aren’t a lot of jobs to fill up with our shiny, new, college-educated brains. As the years tick on, we’re falling deeper into debt to the U.S. Dept. of Education or some private entity like Navient.

In 2016, we stand as a very large, very forward-thinking, in-debt group that doesn’t make a lot of money. And because our incomes are so low, we’re not in a big hurry to get married, start families and buy homes. Back in 2012, just 23 percent of us had actually jumped into those life decisions and that number hasn’t changed much in the past 4 years. In fact, a record number of us are living with our parents and not renting at all.

If we’re not living with our parents, we’re opting to rent apartments — often in cities where we know we can find work — for way more than 30 percent of our monthly incomes. In the UK, millennials will spend at least £53,000 ($70,642 USD) on rent by the time they are 30.

Think about the number you came up with a few paragraphs back. How does it compare now?

In my eyes, the way to give myself financial power in the near future was to go a little bit more into debt and make an investment. I took out a small credit union loan, got a monthly payment that was lower than any rent I’d ever paid, and now I own a piece of land. As I write this, a 550-square foot dwelling is going up on it. In about 5 or 6 years, I should be getting pretty close to mortgage-free. When I think about my parents, who are in their mid to late-50s, still working full-time and still paying off a mortgage on their modest home in small-town Maine — it seems pretty insane that I’d be able to get away with something like that. But maybe I will.

When I tell other people my age about my decision to buy, I often feel like I’m selling out.

I’m not the first millennial to have this idea. The Tiny House Movement basically came to its mainstream peak at the same time that we came of age to participate in it. And because of technology, we’ve been able to redefine work environments, taking our jobs on the road so that we can continue to travel. As a group, we seem to praise alternative lifestyles and an ability to live simply and affordably.

But it still seems like a far-reaching idea for us to choose to own instead of rent. When I tell other people my age about my decision to buy, I often feel like I’m selling out. My intentions are actually the opposite, I took this risk so that I could get the life I want, which basically consists of working on my own terms, traveling at least a couple months every year and doing whatever the hell I want in the meantime. And luckily, the work I do doesn’t depend on an office.

Through my research beforehand, I found that there are many different ways of going about property-buying if you can be a little flexible. In my state, there’s a new trend of millennials buying land in small groups rather than individually, often for farming purposes. Others are working out deals with farmers reaching retirement age, opting to work the land for free for a few years in order to receive owner-financing when the landowner is ready to call it quits. I know several other millennials who have bought small apartment complexes or duplexes, renting out the other units and essentially living for free themselves. Some of us are choosing to buy property with close friends instead of partners. And many of us are living in alternative communities all across the country, creating our own economies and shouldering responsibilities with our neighbors.

But those choosing to take a risk and live outside the normal rental situation are still in the minority, and it often makes me wonder what could happen if more of us ventured a little further out of the typical cities and went where land is cheap. One of the most exciting parts of buying a piece of property in a rural area, for me, was the challenge of immersing myself in a new, small, community — while gaining the financial independence I feel I deserve after being so indebted to my mediocre education. I’m looking forward to putting my own imprint on this place and watching how the area changes in the coming years. I think that if millennials banded together in this way, we’d be able to harness some power and free ourselves of the burdens that are expected of us. Maybe then, we could redefine what it means to have a comfortable, independent life.

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