Skip to comments.Lost Generations? Wealth Building among Young Americans (Gen. X and Y are financially screwed)
Posted on 03/16/2013 10:57:54 AM PDT by SeekAndFind
Unless youre under 40.Today,those in Gen X and Gen Y have accumulated less wealth than their parents did at that age over a quartercentury ago.Their average wealth in 2010 was 7 percent below that of thosein their 20s and 30s in 1983. Even before the Great Recession, younger Americans were on a strikingly different trajectory.
Now, stagnant wages, diminishing job opportunities, and lost home values may be merging to paint a vastly different future for Gen X and Gen Y. Despite their relative youth, they may not be able to make up thelost ground.
If these generations cannot accumulate wealth, they will be less able to support themselves when they eventually retire. This financial uncertainty could reverberate throughout the economy,since entrepreneurial activity, saving, and investment tend to build on a base of confidence and growing wealth.
Meanwhile, the countrys budget crises and public debt burden loom large, and the younger generation could be facing much highertax bills, both in total and as a share of their incomes, than their parents.
(Excerpt) Read more at urban.org ...
Gen X follows the Baby Boomers Some put Gen X starting at 1963.
The first Gen Xers are turning 50 this year. Please stop lumping “Gen X” with the Millenials.
The kids I know in their teens, 20s and even 30s want nothing much more than their I-Phones and a small car!!
My step son and his wife want everything on a beer budget. They also think that everything and everyone’s life should center on them...
I know a 24 year old ‘kid’ who has already received two promotions and is making 60k/year now.. Bottom line? GET A DEGREE IN COMPUTER SCIENCE and learn computer programming as many languages as possible (and work hard)!!!
Add in all the borrowing Bammy is doing for their “benefit” and you’ll see they are indentured servants to the State.
I forgot about THOSE kind!!
The problem with this country is that there are generations of Americans who are jealous or disdainful of other generations of Americans. Reading articles from somewhere called the Urban Institute doesn’t help things where they exhaustively examine wealth between groups of older Americans born in slightly different closely spaced year groups and then complain because we somehow lost to Obama, or whoever they want to blame.
Topping it off, they completely neglect intelligent examination of things like sacrifice for children, homes, stability, and country and concentrate on “how WE - Xer, millenial, et al got SCREWED! because their effing degree ain’t worth anything.....”
Not worth listening to.
I am glad I learned how to support technology years ago. After years in the slow paced and mediocre world of public broadcasting with same type of money, I took a few classes and got a few certs. After a long hard road, I make in the 50s.
Don’t forget the cool name brand shoes and apparel, which are the only other tangible, durable goods with which they appear to concern themselves all that much outside of a decent LCD screen tv and if male a gaming platform attached to it.
They live in a fantasy world online via social media and gaming. The world itself is just a prop or photo backdrop for “so cool, look at me” photos posted to Facebook.
Remove their perception of coolness and being special, get confronted with a very unhappy person, it all turns into a pumpkin and they don’t want that.
It verges upon compulsion, evem psychosis with some. We’ve had to let so many seemingly promising twentysomethings go because they absolutely cannot stop texting, posting and checking Facebook.
That’s the way you do it. Learn and keep at it. Complaining doesn’t do much. If you never buy on credit (long term for nonessentials), save and keep learning and working, you’ll succeed..
It does to them. Just consider yourself fortunate to make an appearance with them via photos in social media. That derivative coolness is worth something, you know, lol.
Why not? They see, Snookie, Kim K or whoever getting their ass kissed on TV each week for doing essentially nothing but being a bitch. Oh, don’t forget the Real Housewives of Anywhere America....faked up collagen-lipped, saline-boobed bitches.
Fortunately, they are not the kind who take pics of their mom and I with them....only her parents (who are on the government dole)....
They’re cool. You’re not. You don’t exist in their idealized online depiction of self. It’s like getting airbrushed out of an official photo under the USSR, just writ very small.
So a third of America’s youth are doing drugs and sitting on assistance..I see it every day. Thanks schools for ruining this next generation.
“...You dont exist in their idealized online depiction of self...”
So true....we are old fuddy duddies. And yet I brought my stepson into my business.
They sure want to go on our vacations with us, though......freeloading once again....
Both of which, are imported.
So no jobs, support them.
We need to bring back lots, and lots, and lots of US jobs.
Kids may be ignorant and lazy, or at least noteworthy than previous generations, but things really have changed.
When my dad graduated from engineering school in the 50s, he told.me he could have bought two houses, “but what would I have done with the other one?”
When I graduated engineering school in ‘84, I couldn’t afford a condo.
Things are even worse for this generation.
My survival plan for my family, is to have my kids skip college or commute to a cheapo one, then work while living at home. They will pay for their food and rent, but hopefully they will be able to put some money away before they get married.
No more debt. The end is near. The clan is back.
And when the big financial collapse happens, that pumpkin will be small and rotten. Reality can be such a ruthless teacher. Build an extra bedroom in your house, cause they will come to visit for a long stay.
Not only are Generation X and Y’ers screwed - so are the Baby Boomers. Baby Boomers will depend on these people to pay their Social Security, if they don’t have the money, then the Gov’t won’t have it either.
Also, expect more generational class-warfare. Poorer Gen Y’ers are going to be looking at Boomers relative wealth, and encouraged by the Left, will ask why these old codgers have so much more they do. As Obama said - wealth is good if you spread it around. Bring on the death panels!
Finally - what the Urban Institutes policy recommendations? MORE Gov’t programs for “wealth creation” among Gen X’ers and Y’ers. Good luck with that.
One area that Gen X folks are lucky is housing. We were able to buy a home in Annapolis MD for about 300K LESS than what we would have paid in 2007-8. Gen X has a lot of positives financially.
“The kids I know in their teens, 20s and even 30s want nothing much more than their I-Phones and a small car!!”
Worse, that’s all that they can even imagine.
I guess in 1983 I was saving money because I didn’t have cable, cell phone or internet. Add up the cost of those and you can see the savings. The more you are able to save when you are young the less you will need to save when you are old.
Our 25 year old took his Master’s right after his Bachelors.
Got married a couple years ago, owns a home now, owns 2 cars, not late model, but nice (no car debt). Been with his present company for 2 years (he graduated younger than most with his Masters) and the promotions and bonuses are starting to come. He’s doing good and very pleased.
But I know a lot of his friends, and they’re doing well also. Young marrieds, making good salaries, getting promotions, saving up enough to buy a house, and a few have already bought. (btw, the housing market is perfect, low prices, really low interest on a fixed 30 year 3.5 when our kid bought.)
So none of his friends, that I know, are really struggling. They have degrees, some Masters, jobs in their field. Little debt. I don’t know what the difference is between him, his friends and the kids I read about who are having a hard time. (All the kids that are his friends, and most of their spouses were homeschooled...could it be as simple as that...I don’t think so, but I have no explanation.)
And it is not only all they can even imagine....they are pawning this lifestyle off on their kids.
We have two grandchildren staying with us this weekend from the aforementioned step son and daughter in law. All they want to do is video games or go to a movie...they’ve been slapping our dogs around, won’t go to bed, won’t eat what we prepare for them because it is not fast food...and on and on..
We try to discipline them a little. they won’t even listen.
I mentioned that they needed to go back to their 24 year old aunt’s house and I thought my wife would never talk to me again....
I dunno... My 25 yr old son has a finance degree and a crappy bank job, making less money than I started out making 32 years ago....
He has MORE MONEY saved in the bank than I had until I was 40 years old.
Living with me has really cut his expenses.. :-(
My parents were hired by the State of California before all the racial and gender quotas, put up with the nonsense for 30 years, and are now drawing pensions and benefits that are bankrupting the state.
Gen X and Gen Y don’t have the same socialist fantasy world job opportunities available, and get to foot the bill for the generations who did.
Roughly Gen X is 1963-4 to 1980-1.
Knowing about money and budgets I think is even more important than what job you have. And this is hardly taught anywhere.
We have two grandchildren staying with us this weekend from the aforementioned step son and daughter in law. All they want to do is video games or go to a movie...theyve been slapping our dogs around, wont go to bed, wont eat what we prepare for them because it is not fast food...and on and on..
We try to discipline them a little. they wont even listen.
I mentioned that they needed to go back to their 24 year old aunts house and I thought my wife would never talk to me again....
So none of his friends, that I know, are really struggling. They have degrees, some Masters, jobs in their field. Little debt. I dont know what the difference is between him, his friends and the kids I read about who are having a hard time. (All the kids that are his friends, and most of their spouses were homeschooled...could it be as simple as that...I dont think so, but I have no explanation.)
Yes home schooling does seem to be the key. The more individuals are kept in a culture that emphasizes traditional values, discipline, hard work and deferred gratification the more mature, functional and competent to deal with the challenges of real life. We live in a toxic culture that is in every way adversarial towards the values that have sustained us for nearly four centuries. The current lords of creation want a population that is a combination of third world peasants and corrupt, weak, ignorant and self indulgent fools so that they can be manipulated with ease and turned into eager little consumerist robots.
Typically, young people of most generations don't start saving money until 10, 20, or 30 years after they leave school. All that lost time is lost compound interest (which equals wealth accumulation).
Everybody is poor in their 20s, don't worry about it. But don't fall into self-pity, or drop out of the job market.
Time IS on your side, if you cut back on the partying and "big boy toys" before you've let half of your life slip away.
But nobody should engage in inter-generational bashing about this issue. That just pushes people apart, and doesn't lead to solutions.
My net worth has probably looked like this at various times in my life, but remember these are only pictures at a certain point in life. Real wealth (net worth) is accumulated over time. That’s probably the major reason seniors appear to be doing so well - they’ve simply been in the game longer and gotten past some of life’s major challenges. Looking at the decline ages of 29-37, I have to ask what affected me at that point in my life. Major issues were a move up house with a large mortgage, cyclical declines in the general economy, family health issues, additional children, job changes, etc. Once beyond college expenses, my wife and I were able to accumulate until the financial collapse of 2008-2013. Now older, without jobs, and in an economy that doesn’t reward savings, I expect many seniors will have financial growth more closely mirroring that of 20-37 year olds.
Here’s how I see it.. Unless you have a fairly high-end education with at least a B.S., you are in for difficult times (There are ALWAYS exceptions, of course).. The major difference between today’s job market and that of 50 years ago is that 50 years ago you could buy a home on a single income and have a ‘stay at home mom’ family with less than a high-end job, such as gas station mechanic. You just can’t buy as much anymore with a mid-range job requiring less than a high-end education. Sadly, the ‘protected class’ nightmare in the workplace has all but nullified the importance of working hard, unlike 50 years ago where hard work was the key to raising your income, regardless of your education.
Parents need to assist their kids, and in turn when the parents get older, the kids need to assist the parents.
We plan to help our kids buy their first house....I want to maximize the overall wealth of the family, and the less money they have to pay out in rents that result reducing overall family wealth, the better....Then they can save that money in their 20s, and help us, when we are old, and they should be financially well off. That’s the way it should work. Families look out for each other...And it is no coincidence that when the government broke families apart, it increase the Federal leviathan exponentially.
I am blown away by the $$ some of these grungers have invested in inking themselves up. Has to be in the thousands of dollars for many of them.
My parents had video games, internet, deregulated air travel, smart phones, a huge variety of ethnic foods (cheeses, sushi, Chinese, Indian), hd movies in the home, recorded shows, reliable cars, air conditioning, etc. and I have less?
The more you are able to save when you are young the less you will need to save when you are old.
Good for you. You seem to have a lot of sense.
It is sad how many of them don’t get this simple truth that you stated.
Many of us in the boomer generation had it pretty easy compared to our parents. But for a lot of us this was the scenario: When we got married, we started out in a crummy apartment with hand-me-down furniture. We made do, scrimping and cutting corners so that we could save up for a down payment on a house. There were no fancy vacations and running up of credit card bills and we did not buy new cars. Eating in a restaurant was a special treat reserved for birthdays or anniversaries.
I see Gen-Xers expecting a house and brand new furniture right off the bat, after they have gotten married in a ridiculously expensive wedding. They get new cars, take expensive vacations, buy too much convenience food, and eat out a lot. They dig themselves into terrible financial holes and figure out what happened. A lot of this can be tracked back to the overindulgence of their parents, who always wanted to give them whatever their little hearts desired.
There are, of course, a lot of other factors at play now, I realize, but I see many couples in trouble because of what I have described.
Wealth accumulation is mostly the equity in one’s primary residence and capital gains on equity investments. Most of the difference in these charts can probably be explained by two phenomena. The first is when the individual go into the stock market via mutual funds and IRAs/401ks, and when they first bought a house.
The earlier one got into the stock market, the less impact the crashes of 2001 and 2008 had. The earlier on bought a house, the less impact the housing bubble had.
Similarly, spending habits of 20-30 year olds by generation would be useful.
Another valuable measure would be to look at the range and median salaries for various jobs and degree levels over time.
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