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If you’re a millennial (people born between 1981 and 1996), the epidemic may have made you considerably wealthier than you were previously.
According to MoneyTransfers.com, millennials account for only 6.6% of America’s wealth. However, they are catching up to other generations as their total net worth has doubled since the first quarter of 2020. Since the first quarter of 2020, when their total net worth was $4.55 trillion, millennials have seen that number spike to $9.11 trillion.
According to MoneyTransfers’ CEO,
Several factors have contributed to this increase in millennial wealth. Firstly, the stock market has recovered significantly since its lows in March 2020, and millennials are more likely to invest in stocks in 2022. The housing market has rebounded, and millennials are more likely to own homes than older generations. Finally, the pandemic has increased many people’s savings, as fewer opportunities to spend money have presented themselves.
MoneyTransfers’ CEO Jonathan Merry
Older Generations own the majority of the Country’s Wealth
It’s essential to put this increase in millennial wealth into perspective. While millennials have seen their net worth double since the pandemic’s beginning, baby boomers (those born between 1946 and 1964) make up 50.4% of America’s wealth, and Generation X (those born between 1965 and 1980) has 29.9%. The silent generation and those born earlier — which include those aged 77 and older in 2022 — have 13.1%.
This means that, even though millennials have made the most gains in terms of net worth since the pandemic began, they remain the least wealthy generation.
There are some reasons for this disparity. Firstly, millennials are more likely to have student debt than older generations, limiting their ability to save and invest. Additionally, many millennials are still early in their careers and haven’t had as much time to accumulate wealth as older generations. Finally, the Great Recession (which began in 2008) hit millennials particularly hard, and many have yet to recover from its effects fully.
Great Prospects Lay Ahead for Millenials
Despite these challenges, millennials are likely to become an increasingly important force in the US economy as they continue to age and enter their peak earning years. They are catching up when it comes to homeownership.
In 2000, only 34% of millennials were homeowners. By 2022, that number has grown to 43%. In comparison, Gen X accounts for 22%, Babyboomers 29%, Gen Z (2%), and the silent generation accounts for 5%. This means that a more significant percentage of millennials’ net worth is tied up in housing than ever before.
While many factors contribute to overall wealth, owning a home is one of the most successful strategies for building long-term wealth for generations. And with millennials making up such a large percentage of the population, paying attention to their unique financial needs and challenges is essential.
Looking at the data, it’s clear that millennials have been dealt a difficult hand when it comes to building wealth. But despite all the obstacles in their way, they are still managing to make progress. And as they continue to grow and mature, they will only become more influential players in the financial world.
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