The idea that debt symbolizes the transition to adulthood is all too familiar for younger generations — and it is easy to understand why that is the case.

What do you consider to be the moment that you’ve matured into an adult?

I’ve always perceived adulthood as the time when you live away from home, have a steady income, and carry greater responsibilities. Many young adults would agree.

Unfortunately, debt offers the illusion of adulthood as well, according to recent research by Rachel Dwyer, an assistant professor of sociology at Ohio State University. The study found that young adults of ages 18 to 27 had higher self-esteem and felt more in control of their lives when they held more credit card and college loan debt.

The findings don’t come as much of a surprise.

Starting in the college years, young adults escape a familiar home environment to a new place of freedom. With credit cards, the ability to make purchases with borrowed funds provides a false sense of income. Tack on the burden of repaying student loans and credit card debt and there’s your recipe for empowerment.

It Starts at Home

It’s understandable that the household’s financial situation influences the effect that debt has on certain groups of young adults.

Those most deprived of experiences and material goods, previously unavailable due to low-income, were found to receive the greatest boost in self-esteem. In the middle class, the effect was evident when holding credit card debt but not from student loan debt. Young adults from wealthy, affluent families saw no such effect from carrying debt.

Read: Are Your Parents Secretly Rich?

“The groups that most need the debt – the middle and lower classes – get the most benefits to their self-concept, but may also face the greatest difficulties in paying off what they owe,” said Dwyer. “Debt may make young people feel better about themselves in the short-term, but that doesn’t mean it won’t have negative consequences in the long-term.”

Student loan debt is often seen as an investment in one’s education that would yield greater returns when a successful career helps to pay back the money that was borrowed. But, declaration of bankruptcy doesn’t dismiss student loans. The total outstanding student loan debt is nearly $919 billion, according to FinAid, an online resource center for student financial aid.

Although credit cards are much more difficult to obtain because of the Credit CARD Act, they remain a dangerous portal to financial ruin in reckless hands. Instant gratification comes as the price of skyrocketing interest rates, forfeiting thousands of dollars that could have otherwise been saved.

Don’t Forget Financial Literacy

One area left out of Dwyer’s study is the effect of financial literacy, or lack thereof.

For the first two years of college, I took out student loans in excess of what was needed to cover tuition — a mistake I did not repeat in the last two years after learning more about personal finances.

Given the knowledge of the perils of debt, young adults from all economic classes — not just low-income families — may be less prone to find self-esteem in debt.

Did you find that debt gave a boost to your self-esteem? Or, are you an anomaly to this study?

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  • James Thornton Robinson III

    I hate having any kind of debt (especially my student loans). The worst is credit card debt. I avoid it at all costs by managing my money and paying off credit cards at the end of the month. I know that credit cards will hold the highest amount of interest fees per dollar than most any other type of debt and I know financial managers always say to pay off the debt with the highest interest rat first.