Wolfstrike
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Young Americans are giving up on getting rich
Young Americansā incomes are depressed, their retirement nest eggs are microscopic, and their rate of employment is weak. The trend lines arenāt promising, either, which likely explains why thereās no shortage of pessimism out there.
http://www.msn.com/en-us/money/markets/young-americans-are-giving-up-on-getting-rich/ar-AAf0jEO?li=BBieRxq
In a Bloomberg poll of Americans age 18 to 35āthe millennial generationā47 percent said they do not expect their cohort to live better than their parents. For one thing, itās hard to imagine outdoing your parents if youāre still sleeping under their roof.
According to U.S. Census Bureau data, 15 percent of people age 25 to 34 were living with their parents last year, up from 10 percent 30 years earlier. High home prices and strict mortgage lending standards are prime reasons for many millennialsā failure to launch.
āThey are priced out of the kind of housing that they grew up in,ā says Richard Portes, an economist at London Business School.
Living at home, or living away from home but depending on help from Mom and Dad, keeps many young people from learning how to manage their finances, says Vicki Bogan, an associate professor at Cornell Universityās Dyson School of Applied Economics and Management. āYou donāt have any ownership, any force to push you to become financially literate,ā she says.
Not all young people have student debt, but for those who do, it can be paralyzing. Jessica Xydias, 25, says she didnāt take out a lot of student loans, ābut my husband did. I look at our accounts all the time. It feels crushing and insurmountable.ā And the debt crimps their ability to save. While paying off loans, she says, āit is extremely difficult, if not impossible, to put money into your Roth account.ā
Ā© Cristian Baitg/Getty Images
One thing millennials do have in their favor, of course, is time. Modest economic expansion that exceeds population growth āis more than enough to support a higher standard of living for our children over time,ā says Gus Faucher, senior macroeconomist at PNC Financial Services. Whether young people dig out from their deficit and end up surpassing their parentsā generation depends on some unknowable things. Will globalization and automation kill or create jobs? Will humankind be saved by nuclear fusion and a cure for Alzheimerās, or be doomed by climate change, wars over resources, and the crippling cost of elder care?
One way to look aheadāand restore some optimismāis to look back to millennial parentsā salad days. Median wages and assets were higher, adjusted for inflation. But would you trade that life for the one you have? Would you give up your smartphone, your GPS, Google, Amazon.com, fresh peas in winter, and Ford F-150s with aluminum bodies that wonāt rust?
Itās just as likely to envision a similar set of innovations 30 years from now that people canāt imagine living without. If so, then no matter what the official statistics say, the best years just might lie ahead.
might lie ahead..
Young Americansā incomes are depressed, their retirement nest eggs are microscopic, and their rate of employment is weak. The trend lines arenāt promising, either, which likely explains why thereās no shortage of pessimism out there.
http://www.msn.com/en-us/money/markets/young-americans-are-giving-up-on-getting-rich/ar-AAf0jEO?li=BBieRxq
In a Bloomberg poll of Americans age 18 to 35āthe millennial generationā47 percent said they do not expect their cohort to live better than their parents. For one thing, itās hard to imagine outdoing your parents if youāre still sleeping under their roof.
According to U.S. Census Bureau data, 15 percent of people age 25 to 34 were living with their parents last year, up from 10 percent 30 years earlier. High home prices and strict mortgage lending standards are prime reasons for many millennialsā failure to launch.
āThey are priced out of the kind of housing that they grew up in,ā says Richard Portes, an economist at London Business School.
Living at home, or living away from home but depending on help from Mom and Dad, keeps many young people from learning how to manage their finances, says Vicki Bogan, an associate professor at Cornell Universityās Dyson School of Applied Economics and Management. āYou donāt have any ownership, any force to push you to become financially literate,ā she says.
Not all young people have student debt, but for those who do, it can be paralyzing. Jessica Xydias, 25, says she didnāt take out a lot of student loans, ābut my husband did. I look at our accounts all the time. It feels crushing and insurmountable.ā And the debt crimps their ability to save. While paying off loans, she says, āit is extremely difficult, if not impossible, to put money into your Roth account.ā
Ā© Cristian Baitg/Getty Images
One thing millennials do have in their favor, of course, is time. Modest economic expansion that exceeds population growth āis more than enough to support a higher standard of living for our children over time,ā says Gus Faucher, senior macroeconomist at PNC Financial Services. Whether young people dig out from their deficit and end up surpassing their parentsā generation depends on some unknowable things. Will globalization and automation kill or create jobs? Will humankind be saved by nuclear fusion and a cure for Alzheimerās, or be doomed by climate change, wars over resources, and the crippling cost of elder care?
One way to look aheadāand restore some optimismāis to look back to millennial parentsā salad days. Median wages and assets were higher, adjusted for inflation. But would you trade that life for the one you have? Would you give up your smartphone, your GPS, Google, Amazon.com, fresh peas in winter, and Ford F-150s with aluminum bodies that wonāt rust?
Itās just as likely to envision a similar set of innovations 30 years from now that people canāt imagine living without. If so, then no matter what the official statistics say, the best years just might lie ahead.
might lie ahead..
