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Millennials facing budget challenges

Millennials in Kentucky may be struggling more with debt than the baby boomers and other generations did. Many millennials have high student loan debts, and the average income for this age group is the lowest since 1980. However, there are a number of things millennials might be able to do to reduce their debts.

The first thing a person must do is look at the total amount of debt. One survey found that a number of millennials do not know their interest rates on student loans or do not know how much they owe. Once a person knows what the debt total is, a plan can be made to deal with it. It may be possible to get credit card companies to reduce their interest rates.

Some budget advice says people should cut out everything that is not essential, but this could leave them living on a strict budget for decades. A better strategy might be to cut out expenditures that the person does not truly value but keep the things that bring genuine pleasure. Debt should also not stop a person from making an emergency fund. In fact, saving six months of expenses can help keep credit card spending down in an emergency.

However, in some cases, the amount of debt proportional to a person's income may simply be too high. If this is the case, bankruptcy may be an option. An attorney may be able to review the choices for debt relief. A person can still keep some assets even in a Chapter 7 bankruptcy filing. While student loan debts generally cannot be discharged in a bankruptcy, if a person is carrying significant credit card or other debt, getting rid of this might make it possible to keep up with student loan payments.

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