A graduating student has “To Begin Anew” written on her cap as she attends a service before the 365th Commencement Exercises at Harvard University in Cambridge, Massachusetts, U.S. May 26, 2016. REUTERS/Brian Snyder

NEW YORK (Reuters) - Millennials face the greatest risk among all U.S. age groups on defaulting on their loans, especially on what they borrow for schools and cars in the next 12 months, UBS analysts said on Wednesday.

Millennials, people who are 21 to 34 years old, hold $1.1 trillion of $3.6 trillion in U.S. consumer debt outstanding. They account for 45 percent student loans outstanding and a third of all auto leases, according to UBS strategists Stephen Caprio and Matthew Mish.

“By number of individuals, 21-34-year-olds were the greatest source of expected spending on big-ticket purchase items over the next 12 months. However, this is where default risks were highest,” they wrote in a research note published on Wednesday.

Furthermore, millennials’ indebtedness in these two areas make it harder for them to buy a home especially in expensive real estate markets without persistent wage gains and continued low interest rates, they said.

A deterioration in credit qualities among millennials alone should not have broad negative impact on diversified U.S. banks and bonds issued by specialty auto and credit card lenders, Caprio and Mish said.

“The worsening US consumer theme is not a systemic issue for U.S. credit,” they wrote.