Save like your life depends on it….Because it does.
Many of our generation’s social trends provide golden opportunities to save and yet most of us are still broke. This isn’t necessarily because we aren’t trying, but because the economy that we were handed as most of us entered adulthood does not cater to our age group. I will do my best to explain the dilemma that we face starting with our outlets for saving money, then explain why we still can’t save money. In the next part of the “Lessons of Life” series I will provide some tips on money-saving which will hopefully offset this seriously depressing article I am about to write.
Older generations appear to be significantly more likely to have been tied down with a house when they were young adults than Millennials are today. For example, 56% of early Baby Boomer 25- to 35-year-olds lived in owner-occupied housing (not owned by their parents) in 1981, whereas only 37% of Millennials lived in such housing in 2016.
This is mostly due to the de-prioritization of marriage, lack of money, or lack of interest. But it is a jackpot for money-saving; especially if you live with your parents rent free.
Relationships cost money. Many millennials have been putting off big commitments like marriage and homeownership in contrast to older generations. A Goldman Sachs data story of millennials suggested that, in the year 2012, only 23% of millennials ages 18 to 31 were married and in their own household compared to 56% of that same age group in the late 60’s. This is another major part of life that seems to intrude most into our pockets.
So if the bulk of millennials do not own a home, are not in relationships, and (in most cases) are not starting families then why is it so hard to save?
*Find your nearest student loan and give it the side eye*
Yup. Student loans are the biggest culprits that keep millennials from moving forward. The average student loan debt load is approximately $40,000 and 37% of people under 40 carry student debt burdens. Yellowbrick, an online research tool that addresses the unique issues of emerging adults, conducted some deep research into the lasting effects of student debt on millennial life. Here are some of those startling facts:
- 37% of people under 40 have student loan debt.
- The average student loan amount is $40,000.
- Americans owe a total of $1.2 trillion in student loans.
- There are more Americans that have student debt than there are Canadian citizens.
- Almost 6% of students owe more than $100,000 in student loans.
On average, millennials are making 20% less than baby boomers were when they were our age. With the average millennial household income being a little over $40,000 and the average amount of student debt also weighing in at $40,000, it is quite hard not to notice that millennials are in one of the stickiest economic predicaments this age group has ever seen in any given point in history.
Be not discouraged! Yes, this sucks but stay tuned for the next article of this series where I will provide some nifty money-saving tips.