Alarming study: 20% of young Germans struggle with debt!

Alarming study: 20% of young Germans struggle with debt!

In Germany, more and more teenagers and young adults are in debt. According to the “Youth in Germany 2025” study, 20% of 14 to 29 year olds have financial debt, which is a record high. The proportion of young people in debt has risen continuously in recent years: first from 13% to 15%, then to 19% and now to 20%. This worrying development is viewed critically by experts. Heiner Gutbrod, youth debt advisor in Tübingen, sees the problem, but emphasizes that not all young people are affected in the same way. Many of those affected come from difficult backgrounds, for example from youth welfare services, or have no financial support networks.

A central problem is impulse buying among young people, who often define their self-worth through consumption. Young adults in particular are increasingly having problems with payment providers who use slogans such as “buy today, pay later”. These offers, such as those from Klarna and Paypal, increase the risk that young people will lose track of their finances. Marco Rauter, a debt consultant from Berlin, explains that easy access to online purchases without prior thought accelerates debt.

Consumer psychology and debt advice

The debt collection industry is increasingly benefiting from payment difficulties. Almost seven million people in Germany are over-indebted, and the economic consequences of the corona pandemic could further increase this number. A survey of 1,400 debt counseling centers in Germany shows that 65% of the counseling centers have noticed an increase in problems related to “buy now, pay later” offers. Although over half of these places did not report an increase in the number of people under the age of 25 seeking help, a quarter increasingly looked after this age group, which Roman Schlag from the Caritas Association describes as an “alarm signal”.

In addition, many people under 25 have difficulty finding their own apartment because loan obligations have a negative impact on their Schufa scores. Often they still live with their parents, but have a low income, which accelerates debt and can cause problems paying rent. Caritas is also calling for more general financial education in schools, as 93% of young people would like to see more attention to money and financial topics.

Debt as a lifeline

Gutbrod, who works in debt counseling, emphasizes that debt assistance is also life support. For people who are over-indebted, insolvency proceedings can offer a possible way out of the debt trap. In debt counseling, an overview of current debts is often created first in order to set priorities. Gutbrod lets young people know that mistakes are allowed as they find their way into professional life.

Overall, it is clear that the challenges young people face when dealing with money are significant and that a more conscious approach to financial obligations is urgently needed. The increasing number of young people in debt raises concerns and highlights the need for comprehensive education and preventative measures.

For more information on rising youth debt, check out reports from ZDF and FR.