The Generations That Feel Financially Worse Off Than Their Parents
Written by
Emily Fowler
Edited by
Rebekah Evans
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Financial struggles are nothing new, but some generations feel the squeeze more than others when it comes to their finances. A study by Credit One Bank found that 35% of Gen X and 33% of millennials feel worse off than their parents, far more than the 19% of baby boomers and 17% of Gen Z who say the same.
Stagnant wages, soaring housing costs and crushing student loan debt have left many Gen Xers and millennials questioning whether they’ll ever achieve the same financial stability as their parents.
A Tougher Financial Landscape
Boomers grew up and entered the workforce during a period of economic stability, where wages grew proportionally to costs and housing was affordable to the average person. This meant more opportunities to buy homes, build savings and retire comfortably. Â
Gen X and millennials haven’t been as lucky. Wage growth hasn’t kept pace with inflation, home prices have skyrocketed and the cost of education has left many saddled with debt before they even get a chance to build wealth. The financial rules that worked for previous generations no longer apply, making it harder for those generations to get ahead.
A Shift in Financial Conversations
Despite these challenges — or perhaps even because of them — younger generations seem to be more open to conversations about their finances. The study shared that 53% of millennials and 50% of Gen Z grew up talking about long-term financial goals like investing and retirement, for example, compared to just 36% of Gen X and 28% of boomers.
While talking about money might have been seen as something too private for American households in the past, being open and honest about these things is obviously getting easier.
Stress and Anxiety Are Rising
Financial strain isn’t just about numbers, it also affects mental well-being. The study found that Gen X and millennials report far higher levels of financial anxiety than boomers. More than half of Gen Xers (54%) and millennials (51%) say money is a major source of stress, compared to just 29% of boomers.
Gen Z, despite their financial openness, isn’t immune to stress either, with 59% of Gen Z saying they experience financial anxiety, the highest of any generation in the study.
Homeownership Challenges
According to the National Association of Realtors, while the average homeownership rate for boomers and Gen Xers under 35 was 39.7%, millennials have yet to reach that level. In fact, the median age of first-time homebuyers today is 38, up from the historical range of 28 to 33.
Though Gen X had a similar homeownership rate to boomers at the same age, factors like rising cost of living and increasing debt means many of that generation have found it hard to maintain the financial stability their parents did.
Looking Ahead
Despite the amount of Gen Xers and millennials feeling financially worse off than their parents, plenty are taking proactive steps to change their financial futures by prioritizing long-term financial goals, being willing to be open about money and pursuing financial education. However, systemic issues — such as wage stagnation and student debt — continue to weigh them down. Shifts in policy and economic conditions are needed to improve the financial future for younger generations.
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