Millennials Own Just 3% of the National Wealth.

[james.hendrickson]

Here is an interesting graphic that you all might find interesting. Evidently Millennials are having a more difficult time than other generations at building wealth. According to this chart, Millennials own just 3% of the national wealth, which is far less than the wealth achieved by Gen X and Boomers at comparable ages.

Some reasons for it are:

1. The Great Recession. Millennials had a harder time recovering from it than other generations. This is is especially the case for African-American and Latino millennials.

2. Covid and labor patterns. Millennials have been employed in industry sectors disproportionally impacted by covid related layoffs - including hospitality, housing, etc.

3. Asset ownership: Controlling for age, Millennials have accumulated fewer assets and have more debt, which has retarded their wealth building.

[jenn_jenn]

As a younger millennial, this is not at all surprising.

For example, home ownership remains strongly linked to wealth building. As a single income household with 4 children, my parents purchased a home for <$300k in the 90’s. That same home is approaching $2M today. My dad is an engineer which is a good job but it’s not an exceptionally high paying position.

My husband and I both have good jobs, no kids, and we can’t afford that same house.

When adjusted for inflation our incomes are lower than previous generations at our age and asset prices (that previous generations already own) are rising.

[Fishindude77]

The opportunity for wealth is certainly out there.
Most boomers are at or near the end or their careers and everywhere you look jobs are going unfilled.

Regarding the $2mil house mentioned above ...... hardly anyone in America can afford to buy a $2mil house regardless of age. There are plenty of places (with jobs) where your money goes much further and great homes can be purchased for $200k and less.

[jenn_jenn]

The opportunity for wealth is certainly out there.
Most boomers are at or near the end or their careers and everywhere you look jobs are going unfilled.

Regarding the $2mil house mentioned above ...... hardly anyone in America can afford to buy a $2mil house regardless of age. There are plenty of places (with jobs) where your money goes much further and great homes can be purchased for $200k and less.

It may be an extreme example but you’re seeing it in places across the country where even people that live there now couldn’t afford to buy their home at the current value. Housing prices are at an all time high right now and that’s a problem for a generation that is trying to buy into the market.

That aside, the punchline is that millennial income is less than previous generations when adjusted for inflation while asset prices are rising.

The job market is indeed hot and job opportunities are rising but that doesn’t make up for the time already impacted by the above.

I’ve read numerous articles stating along the lines that this will be adjusted when millennials start inheriting wealth from the older generations - and that’s a whole ‘nother slew of problems.

[Fishindude77]

That aside, the punchline is that millennial income is less than previous generations when adjusted for inflation while asset prices are rising.

Plenty of opportunities out there to get your income up and / or places you could locate where your money goes much further.

[ua_guy]

All the crotchety old people will lecture millennials into a corner for not trying hard enough, not seizing opportunity right beneath their noses, because these old people spent 40 years of their own working life doing things one way, and YOU SHOULD TOO!

The US added an additional 100,000,000 people to the roster of the living, since I was born, not quite 40 years ago. I'm the oldest of the millennials. There's more competition for everything, including resources, jobs, housing, land, food, clean water. The sooner we admit the world is a very, very different place from even 30 years, 40 years, ago, the better off we'll be. That doesn't mean there isn't opportunity to be had, but it means the challenges are different, and so are the solutions.

I'll bet it feels good to arm-chair it from the perspective of someone who is 50, 60 years old. "If millennials would just...." Right. Uh-huh. If the answers were that easy, people would "just" do those things. It's not that millennials are too stupid or lazy to come up with the low-hanging solutions to problems. But it might be that the hallucinations of an older generation are out-of-touch with reality.

[JoeP]

So if you're a millennial living in an urban area where you can either rent or go into a lifetime of debt with your spouse in order to "afford" a $2M house (and the associated taxes) what should you do?

[rennigade]

Ehh...millennials are pretty lazy, generalizing of course. Im at the tail end of millennials. It gets worse for the younger generation, whatever letter they are now. I know people I graduated with in high school that still live at home. Younger crowd is even worse. They never plan on leaving home.

Also, lets not equate someone who has a high paying job to a good work ethic. They can be lazy too. I know plenty of well off older adults who are lazy.

[Singuy]

This chart is very misleading and doesn't represent anything unless you account for all variables.

First of all we should compare 2019 millennials to 1990 baby boomers because both are 35 years old here. So basically millennials own 3% of the wealth at 35 vs baby boomers who owned 21% of the wealth when they were 35 yo. Now you have to account for the population of baby boomers vs other pre baby boomer generations and see if that's the similar to millennials compared to gen X + boomers today 2019.

The baby boomer generation skew the chart by a lot when the population of the silent generation and the greatest generation being counted less into the mix in 1990 than today's baby boomers against millennials.

Having said all that, there is most likely some truth to millennials being worst off wealth wise when the best wealth building tool such as a house is out of reach for a lot of people. However the gamut is probably not as big as this graph is saying.

[LivingAlmostLarge]

The truth is that millenials make less and have less wealth. I'm a generation Xer, and I like to point out we're the quietest generation with the most independence and have survived a ton of crap. #1 latchkey/divorced kids. Our parents divorced the most and fastest and most of my generation recall coming home solo and watching tv, doing homework, and playing video games and nuking food. You know what i mean. NO helicoptering and no coddling. Our moms were too busy working as single women to do it. We just did a lot solo.

We graduated and watched jobs go up in smoke with the dot.com bust. I have friends who had jobs offers and jobs that disappeared and were told don't move up to SF. Tons of friends struggled to find jobs in 99/00. Then we were the PEAK generation who lost our shirts in the 07/08 housing crisis because we were prime home buying age. I've yet to really meet couples or singles that are Xers who weren't underwater. Some walked away, many sucked it up and rode it out. And others couldn't buy then and can't buy now.

Millenials = bad job market. Xers = bad job market with dot.com bust and then without real jobs couldn't really afford homes so we did the arms and crazy loans then lost our shirts. And in the 90s is when the 6 figure student loans started becoming common. So we had that as well. Xers are also the first generation 40-55 who have the majority by a lot of no pensions. It'll be interesting when we retire....

I have friend who had pension jobs at 22 but then it got taken away or frozen. So we were sold one thing to be given another. Yep the Xers are a very interesting generation. But like always Xers are quiet. I read that's the trend. We're the boring, quiet generation of just doers who learned to raise ourselves and just meander on.

[jenn_jenn]

Plenty of opportunities out there to get your income up and / or places you could locate where your money goes much further.

I can’t tell if you are saying “you” as in me individually or you as in referring to the millennial generation but it seems like this is directed at me individually.

If it’s me individually, your comment is misguided.

[riverwed070707]

The opportunity for wealth is certainly out there.
Most boomers are at or near the end or their careers and everywhere you look jobs are going unfilled.

Regarding the $2mil house mentioned above ...... hardly anyone in America can afford to buy a $2mil house regardless of age. There are plenty of places (with jobs) where your money goes much further and great homes can be purchased for $200k and less.

10 years ago I would have 100% agreed with you. As a lifetime Iowa resident who has always touted the affordability of real estate here, can confirm great homes can no longer be purchased for less than $200k in most places - certainly not a home large enough for a family with 4 kids and especially not on a single income. Not to mention our property taxes have skyrocketed - currently paying $6k/yr on a 1,400 sq ft home outside the city. My first house I bought was actually larger than this one, in the same county and my taxes were less than $2k/yr. That was only 13 years ago. Saw a little 2 bed, 1 bath rental pop up a few months ago that I used to rent when I was in college for $600/mo... rents for $1,400 now. Same landlord owns it. Wages have not increased to match the rising cost of living. Our younger generations are being set up to fail driven by the greed of our older generations - what are they going to do with all that money when they die?

[MonkeyMama]

I personally feel for the millennials.

I am a young Gen Xer (close to the Gen X/Millennial border) and have experienced much the same. That said, because we started out in San Francisco and were dealing with massive housing prices, we spent our first two years out of college saving 80% of our income towards a house. That's how we managed it. Thank goodness, because that was the most money we ever made. It's easy for me to see that the millennials didn't even get those "2 good years" and how much we were able to prosper off of that. This is why I really feel for the millennials.

Yeah, as a Gen Xer, there's two things. We tend to just suck it up and figure it out (no matter how ridiculous the solution is). But it's also nice to not have older people constantly screaming at us that we are idiots. We are very much ignored.

For us personally, we did give up and move to a lower cost locale, to deal with housing costs. I'd say that was like 2 years of our life, and then we moved and mortgage interest rates fell by half (twice). But the flip side of that is my husband has never been able to find a full-time job in our lower cost locale. Of course, it's complicated. We were personally excited about job opportunities with the pandemic shake up. The reality? As always, there's 100s and 100s of people applying for the good jobs. People are leaving the bad jobs in droves. Which isn't very helpful to people who are picky on the employment front (some of the "it's complicated"). We aren't ready to give up, but early on the "opportunity" just isn't there. We really thought something full-time might open up at MH's job. Just got word, nope. It's unbelievable that no job has opened up (after sending everyone home for 12+ months). I am curious to get the scoop when he goes back. I'd say that we don't live in an area where people can realistically live on unemployment. They wouldn't be able to afford the roof over their head. So I wonder if they just took other jobs and the grass wasn't greener. If they just stopped paying rent?? I don't know! So curious for the scoop.

Anyway, whatever, we are very Gen X and just roll with it.

But I share because housing is a mess and we are Gen X enough to not be in the millennial boat. But the one thing I didn't see mentioned was healthcare. Healthcare has been our biggest financial challenge, hands down. Healthcare will be 20%+ of our income for 30 years probably. Our health insurance surpassed our mortgage payment as biggest household expense, many years ago. Obviously millennials have to add this to their mountain of economic challenges.

[Singuy]

I don't feel bad for millennials at all. Throughout history, the Greatest generation dealt with the great depression, the silent generation was in a world War, the boomers had Korean War, Vietnam, and social unrest from social justice reform...millennial have what...the financial crisis..kind of?. I mean the event just happened to bring home prices down to more than affordable.

Millennial have access to the most powerful and fastest information generation's ago thought was science fiction.. All this during the longest period of peace time.

The barrier to entry if you want sell your goods or talent used to be a grind, but now you have access to millions of customers at your finger tip with Amazon, eBay, etsy, and fiverr. Content creators used to be broke Hollywood waitresses, but now can make millions from YouTube or tic tock without much of a talent.

Millenials need to get with the time and utilize all the tools at their disposal, and these are very powerful tools. Those who took the time made a living very fast, while many cling on to a past that no longer exist and point fingers at how it's so difficult today.

I took the time to learn about stock investing.. it was a long grind but I know for a fact if this was 1950s, I wouldn't have made it. It was having access to online message boards in which there were people doing pretty complex discount cash flow analysis, technological deep dives, and access to all sorts of unique data that made this endeavor successful. It's all there, one just need to have patience and put in the work. But unlike the 1950s, I don't have to know everything myself as you can just read other people's conclusions with a mouse click.

[disneysteve]

Why does every generation find it necessary to criticize and insult those that come after them?

Life is hard. We all face numerous challenges and struggles. Comparing what my generation or your generation faced to what some other generation has faced serves absolutely no purpose.

I also think there is a tendency for older folks to be at least a little out of touch with what current young people are dealing with. We all view things through the lens of what we experienced and may simply be unaware of how dramatically things have changed in 10 or 20 or 30 years since we went through it.