Forbes recently ran this article — Gen X and Gen Y Wealth Stagnates.
The article is based on a study by the Urban Institute which compares the wealth of various age cohorts as it stood in 1983 versus 2010.
Forbes reports as follows:
“While the net worth of those 47 and older is roughly double that of someone the same age 27 years earlier, today’s adults in their mid-30s or younger have accumulated no more wealth than their counterparts 27 years ago.
Specifically, those ages 29 to 37 (younger Gen Xers and older Gen Yers) actually lost significant ground; they saw their average net worth drop 21% between 1983 and 2010. (The comparison is between people of the same age in 1983 and 2010).”
Those age 20-28 are only 5% better off than their peers in 1983; those age 38-46 are 26% better off.
The study authors blame stagnant wages, diminishing job opportunities and lost home values during the Great Recession, which hit the younger generations the hardest.
Will the Gen X and Yers eventually hit the accelerator pedal? And have plenty of money to give away?
Maybe not. The authors worry that the younger generations could face higher taxes than their parents going forward, and will be less likely to have a pension … “Despite their relative youth, they may not be able to make up the lost ground. If these generations cannot accumulate wealth, they will be less able to support themselves when they eventually retire.”
By comparison, wealth increased for those age 47-55 by 76%, for those age 56-64 by 120%, for those age 65-73 by 79% and for those 74 or older by 149%.
Fish where the fish are, folks.
P.S. Here’s a blog post by one of the authors on the study if you’d like to explore further.
P.P.S. For a more optimistic view regarding Millennials, try this post.