Millennials Are Screwed: They’ve Fallen Financially Behind Every Living Generation
Despite boasting higher education rates than every living generation, millennials have fallen so far behind financially that they may never catch up.
Some place the blame on social media influence, arguing that millennials are far more likely than previous generations to be convinced to make purchases based on social media.
The dark reason so many millennials are miserable and broke https://t.co/zIC7uoJEkm
— MarketWatch (@MarketWatch) May 13, 2019
Others have argued that nonessential purchases like “avocado toast” and fancy coffee drinks are the real culprits, primarily because they are relatively small purchases that add up quickly.
It’s a big part of what makes this Chase tweet so bad.
It’s the idea that if you choose to have any expense beyond mere animalistic survival – an iced coffee, a cab after a 18hr shift on your feet – you deserve suffering, eviction, or skipped medicine.
You don’t. Nobody does. pic.twitter.com/XKo6ayPfRJ
— Alexandria Ocasio-Cortez (@AOC) May 11, 2019
But according to a report from the Wall Street Journal, a number of key factors have played a role in millennials’ — born between 1981 and 1996 — apparent inability to catch up to previous generations. None of them mentioned avocado toast.
Hobbled by the financial crisis and recession that struck as they began their working life, Americans born between 1981 and 1996 have failed to match every other generation of young adults born since the Great Depression. They have less wealth, less property, lower marriage rates and fewer children, according to new data that compare generations at similar ages.
And some of those factors could effectively perpetuate themselves, creating similar problems for future generations. The lower birth rate, for example, could mean that by the time millennials retire the number of workers paying into programs like Social Security could face precipitous dropoffs.
If the current birthrate of 1.8 children per household remains steady or drops, Social Security alone could reach a $2 trillion deficit in the next 75 years — a shortfall that could prove devastating for the children and grandchildren of millennials.
The fact that many millennials entered the workforce for the first time in a stagnant economy could also play a role in their lifetime earnings, according to Till von Wachter, an economics professor at the University of California, Los Angeles.
“The effects have health and lifestyle consequences well into middle-age,” he said.
Additionally, many millennials either did not have the means to invest or entered the workforce too late to capitalize on the rapid market growth in the years since the economy began to turn around. (RELATED: Americans’ Confidence In Job Market At Record High)
The student debt crisis is also a key factor, and a number of millennials have said that their degrees were not worth the amount of debt accumulated while acquiring them. Millennials as of 2017 carried an average student loan debt of $10,700 — twice the debt carried by the average Gen-Xer (mid-1960s to early-1980s) in 2004.
Their dissatisfaction with the debt-to-reward ratio of student loans, in part, is what has left a number of millennials disillusioned with the current system — leading to greater support in the younger generations for candidates who promise to do something about that either for them or for future generations.