New Study From LendingTree Reveals: When it Comes to Debt, Children Are Indeed the Future

Released  October 26, 2005
By Megan Greuling

New York, NY–October 26, 2005–An important new research report called “LIVING WITH DEBT: A Life Stage Analysis of Changing Attitudes and Behaviors” was released today at a press conference in New York City. The report, which was commissioned by LendingTree, examines how attitudes and behaviors related to consumer debt have changed between generations, and also how these attitudes and behaviors progress throughout the various stages of adult life. In recognition of the particular financial pressures and debt triggers that occur within certain groups, the study examines:

  • College Students

  • Young Singles

  • Young Families

  • Mature Families

  • Empty Nesters

  • Seniors

The full report, as well as the executive summary of highlights, can be downloaded at

In underwriting this research, LendingTree hopes to contribute to the national dialogue about the state of debt in our lives, and, most importantly, to mobilize consumers to arm themselves with the financial literacy skills they need to make smart borrowing decisions.

The author of the report is Robert D. Manning, Ph.D., economist and professor of finance at the Rochester Institute of Technology, and author of Credit Card Nation. Dr. Manning is a specialist in consumer finance, socio-economic trends, and retail banking deregulation, and has testified before Congress on the use of credit.

Research Highlights

Overall, the study underscores several universal themes that appear consistently across life stages:

  • Living with increasingly higher levels of debt has become an accepted and normal state of affairs — considered an inevitable and likely permanent feature of everyday life. The social stigma of high levels of debt is largely gone.

  • Many people attribute their willingness to go into debt — or to take on additional levels of debt — directly to a dramatic increase in spending on children and grandchildren. Even older life stage groups, who more typically adhere to the “traditional” financial values of thrift and frugality, report using credit much more freely when spending on what they feel are “socially expected” lifestyle activities and accessories of their kids. Consequently, as families save less for college and rely more heavily on student loans, this contributes to higher debt levels among their children, who enter young adulthood with more debt (both student and consumer) than previous generations.

  • Attitudes toward home ownership have changed, from simply providing necessary shelter to satisfying both a need and a tangible, secure (and considered near perfect) investment. Home ownership has become a much more important piece of the overall personal finance equation, with the real or expected appreciation in home equity often considered a financial stabilizer or “way out of trouble.”

  • Many participants feel ill-equipped to make prudent financial decisions, expressing an explicit desire for practical personal finance education, information and services. Long-term financial planning, with the exception of buying a house, is largely absent. Few have developed, let alone adhere to, a personal budget, although older groups were more likely than younger groups to do so.

Additional highlights for each life stage can be found in the executive summary at:


The study uses a life stage approach based on the assumption that the experiences of the different groups illuminate current and future trends related to consumption and saving/borrowing patterns. This approach helps to distinguish the unique influences of particular household dynamics, drawn from behaviors and experiences that vary across historical periods, or what is commonly referred to as “cohort effects.” Therefore, each life stage group is specified as a methodologically and sociologically discrete category; two focus groups comprised of randomly-selected members of each of the six specified life stage groups were conducted on consecutive days over the summer of 2005 in three distinctly different geographic regions: Rochester, NY; Washington, D.C.; and Orlando, FL.

More information about the study’s methodology can be found at:

The LendingTree Commitment to Borrower Education

As part of its ongoing mission to empower borrowers, LendingTree also announced today it has launched a multi-year education and advocacy program around smart borrowing with the goal of inspiring consumers to make informed and savvy borrowing decisions.

Starting today, a reader-friendly and information-rich resource–The LendingTree Guide to Smart Borrowing: How to Use Credit Wisely Throughout Your Life–is available at no cost to consumers. The guide can be ordered in hard copy or downloaded electronically at:

Also through the Smart Borrower education initiative, the Web site offers an extensive library of articles, information, interactive tools, calculators and expert advice, all of which assist borrowers in making informed decisions about managing their debt. In addition, the company offers a free monthly educational newsletter and a series of comprehensive loan product guides designed to help borrowers understand and compare loan products and offers. They also provide helpful questions to ask during the borrowing process.

About LendingTree, LLC LendingTree®, LLC is the nation’s leading online lending exchange, providing a marketplace that connects consumers with multiple lenders that compete for their business. Since inception, LendingTree has facilitated more than 16 million loan requests and $109 billion in closed loan transactions. LendingTree provides access to mortgages and refinance loans, home equity loans/lines of credit, auto loans, personal loans, and credit cards via and 800-555-TREE.

Founded in 1998 and headquartered in Charlotte, North Carolina, LendingTree, LLC is part of IAC Financial Services and Real Estate, an operating business of IAC/InterActiveCorp (NASDAQ: IACI), which also owns or operates LendingTree Loans, LendingTree Settlement Services, LLC®, GetSmart Lending®,, Domania, and iNest.

# # #