They earn less, they save less, and they’ll live longer
We make up the biggest generation in today’s workforce and yet we can’t earn a better living than our parents or grandparents did half a century ago.
Research group Young Invincibles says millennials have half the amount saved baby boomers did at the same age. It’s no surprise since in the same study, millennials are making $10,000 a year less today than their 1989 counterparts.
“Millennials have been set back significantly, by not just the Great Recession but by decades-long financial trends, resulting in major generational declines in financial security between millennials and baby boomers when they were the same age,” says Tom Allison, deputy director of policy and research for Young Invincibles.
“Millennials make up the greatest share of the workforce and the largest generation in history, so in many ways the situation facing young adults today forecasts the financial challenges ahead for the nation,” he added.
When baby boomers were the largest generation in the workforce, they were much more financially secure, YI says. They earned more money, acquired assets faster, and there was a stronger likelihood they owned homes earlier in their careers.
Among the key findings are:
- Millennial net wealth is half as much as baby boomers when they were young adults
- Wages for millennials have declined by 20 percent
- Education is still the biggest factor in financial security
- Educational benefits might be hidden by the burden of student debt
- There is still a huge discrepancy in wage gaps between white people and people of color
What a difference a degree (and debt) makes
Despite $1.3 trillion in student loan debt, a college degree is still worth it. Most everyone thinks so. Even the YI report.
“A young adult without a college degree in 1989 earned roughly the same income as a college graduate with student debt today,” the report says.
While salaries are down for millennials compared to baby boomers nearly 30 years ago, a degree makes a difference. The report shows that while millennials are already earning less than their baby boomer parents, still having a degree (with or without debt) means you’ll be making $10,000-$30,000 more than without a college education. Without, you’d be even further behind, depressing as that is.
Money ain’t a (big) thang
Millennials not earning as much isn’t exactly shocking. Most of us don’t expect to see $1 million in our lifetime, and that’s because our salaries are so low. Two-thirds of millennials are barely making it to $30,000 annually.
It may be because we want to like our jobs more than we want more money. Higher salaries are cool, but it turns out young people really want a workplace that makes them happier. Happiness means enjoying the work, which means more company growth, which could eventually mean a higher salary. But it’s not the immediate goal of millennials.
But money is still top of mind to nearly everyone. Because we love our jobs, we work all the time. And we work nonstop because we need the money. The endless cycle of money-related stress is real, as 80 percent of young people think that is financial stress were removed from the picture, they would be much happier professionally.
Article last modified on June 5, 2017. Published by Debt.com, LLC .