Meet the Last 20 Millennials: Wealth, Work, Homeownership

• The youngest millennials are 28 and 29 this year.
• These cusper Zillennials are twice as wealthy as their geriatric millennial peers.
• Many of them are living at home and staying single longer.

I’ve been writing about millennials since 2018, when they were between 22 and 37 years old. Entering adulthood during the rise of social media and online shopping, coupled with unique economic challenges, has thrust this cohort into the spotlight.

People were fascinated by what the children were doing. Millennial stereotypes about brunching on avocado toast and living longer with their parents have particularly intrigued the world: Who was this generation that seemingly couldn’t grow up?

Well, they grew up. The oldest millennials will be 43 this year, according to the Pew Research Center Definitionand the majority of the generation has entered the milestone years of buying a home and starting a family.

Soon the generation will completely outgrow their twenties and leave adulthood behind. The youngest of the generation, born in 1995 and 1996, will be 28 and 29 this year, and there are just under 9 million millennials left in their 20s, according to the U.S. Census. This cohort belongs to cusper territory, those born between generations, and are part of the larger “Zillennial” microgeneration.

Not quite millennials, not quite Gen Z, these twenty-somethings are being shaped by the pandemic that comes at the start of their careers and early years of wealth creation. In some ways, they are faring better than their older millennial peers, and their struggles reveal larger cracks in America’s social support systems.

A bridge in the workplace

Diana Elliott, vice president of programs at the Population Reference Bureau (PRB), told Business Insider that your late 20s have always been the best year to establish a career. However, these twenty-somethings have seen the pandemic shorten their typical office experience more than the rest of their generation. They were only 24 or 25 years old at the time and had only been working for a few years, and they fear this will give them an unequal position in the job market.

“They feel it has negatively affected their ability to learn the soft skills that working in an office provides and may lead them to miss out on growth opportunities,” said Gabby Davis, a career expert at Indeed and a young millennial herself. , to Business Insider. But Davis said Indeed’s research shows they don’t want to return to an office full time. Although mandates back in office have the potential to push them back, she says younger millennials are more likely to stay employed than Gen Z, who see their jobs as more dispensable.

Cuspers often act as a bridge in the workplace, but younger millennials may struggle to bridge that generational gap when reporting to older colleagues and managing younger ones, Davis said. But they’ve already been pushing for more flexibility, communication and transparency at work, which she says can help ease this transition. Millennials, now the largest generation, will continue to advance into leadership roles as they age into their 30s and 40s, which Davis says will help “drive diversity, responsibility and places more meaningful work”.

As the generation ages, Elliott predicts they will begin to take on the roles of baby boomers as they retire. “We’re going to see a lot of people leaving the workforce, not just now, but over the next decade,” she says. “So this could be a really exciting time for opportunities for young millennials in the job market.”

Roll in dough

At first glance, it seemed that the pandemic could also jeopardize the wealth trajectory of younger Millennials and older Gen Zs. Older millennials have faced the aftermath of the Great Recession and the 2008 financial crisis, rising costs of living and $1.2 trillion in student debt.

In 2018, the St. Louis Fed predicted that people born in the 1980s were at risk of becoming a “lost generation” when it comes to wealth accumulation. Fortunately, this did not happen: in 2022, their wealth level was 37% higher than expected. But the wealth of younger millennials and older members of Generation Z has seen an even sharper shift, at 39%.

This wealth is even more striking when compared to their older peers of the same age. In 2013, 24- to 33-year-olds had a typical wealth level of $16,567, according to data provided by the St. Louis Fed to Business Insider. That’s more than double (even accounting for inflation) for people ages 26 to 32 in 2022, whose typical wealth level is $55,760.

This shows how much the macroeconomic context can change even within a generation. Lowell Ricketts, a data scientist at the St. Louis Fed, told Business Insider in late May: “You have these older millennials who are still dealing with some of the consequences of the Great Recession, a sluggish economy in which the results employment languish for a while,” he said. . “Young millennials survived much of the pandemic-related disruption to 2022 and were left with much higher accumulated wealth.”

Ricketts said the shorter duration of the coronavirus recession and the more aggressive federal policy response saved them. A government cash injection and a lockdown that kept us from spending on travel and dining out “boosted many bottom lines across the wealth spectrum,” making 2022 a record year for wealth accumulation.

Become a creative owner

The Fed estimates that real estate has been a key driver of wealth gains among younger millennials, as a hot pandemic housing market has driven up home values. But aren’t millennials incapable of buying a house, especially those who have had less time to save? Ricketts said despite affordability issues, some have been able to make it work.

Younger millennials are getting creative about becoming homeowners, said Jessica Lautz, deputy chief economist and vice president of research at the National Association of Realtors. They live at home primarily to save money or form a partnership: 19% of people aged 25 to 33, including the youngest millennials, are unmarried couples, the highest rate higher than NAR sees among all generations in its Generational Trends report.

They are also most likely to receive down payment transfers, often from family members who helped them with the purchase. Perhaps this is why 55% of them prefer to live near friends and family; the only other generation that comes close to this preference is that of retirees. “They’re moving out of their family members’ homes before purchasing at higher rates, so maybe they already have that strong family connection,” Lautz said. “During COVID, a lot of people have reprioritized what’s important to them, and family is more important.”

A mixed bag for women

Young millennial women in particular have seen their economic well-being improve; According to a PRB study, increasing educational opportunities allow them to earn more than their mothers and grandmothers compared to men. “The wage gap is narrowing with each successive cohort,” Elliott said.

Because young millennial women are focused on their careers, they are continuing the general millennial trend of delaying starting a family. The fertility rate in the United States decreased by 3% between 2022 and 2023, reaching an all-time low. “What this suggests is that younger millennials are likely to have smaller families,” Elliott said. This is neither good nor bad, but it interacts with other economic factors such as housing affordability, entry into the workforce and student debt.

Of course, generations are nuanced. Not everyone does well; some millennials are stuck in poverty, and young millennial women have lost ground in terms of health and safety. “The systems and supports are not in place to understand how to best help people,” Elliott said. “We need it now. In terms of maternal mortality, this largely reflects how the United States is not doing as well as its peers.”

And some of the wealth accumulated by young millennials has faded because of inflation, Ricketts said. He nevertheless hopes that “the wealth results we see in 2022 could be an optimistic note and a source of strength for the future.”

He pointed out that young millennials who invest their wealth well are more likely to consume and drive economic growth. “Having entrepreneurial aspirations while having wealth at your fingertips allows you to pursue those dreams,” he said. So, by investing in yourself and your passions, it can also benefit the economy as a whole. »