It’s a tough time to be a young adult. Take the housing market, for example. It’s been fairly locked up since the last recession, when many millennials were still in high school. Now that they have jobs and credit history, it turns out millennials struggle to find a house to buy. In many areas, they need cash for a big down payment as well as money for a contractor to renovate a home that hasn’t been touched since the 1970s.

Because so many graduated in an era when jobs were scarce, followed by an era during which wages have stagnated, young adults are not earning as much income relative to previous generations. According to one study, in 1970, 92 percent of 30-year-olds earned more than their parents did at that age, but in 2014, only 50 percent of 30-year-olds could make that claim.1

Impact? “Being a 25- to 34-year old is harder than it’s been in generations.”2

This can put some retirees and late-stage workers in a quandary. Many parents want to help their adult children financially. Some are tempted to use retirement savings to help pay off student loans or contribute to a down payment on a home. Depending on your situation, that might not be the best decision. If you’d like to help your children or grandchildren, we can help you look at your current budget and determine potential strategies.

Due to the high cost of college tuition and the number of students graduating with student loans, millennials now carry an average debt of $42,000. Clearly, this is going to stymie their ability to build wealth and savings. But there are other long-term impacts as well:3

  • Financial stress affects physical and mental health, not to mention focus and productivity on the job
  • Millennials are more interested (95%) in accepting a job from an employer that offers student loan repayment, so certain industries benefit more from college recruits
  • They are reluctant to commit to long-term relationships while saddled with huge amounts of debt, which may reduce birth rates (and the ability to fund future Social Security and Medicare benefits)
  • Among the demographic group just behind millennials – in response to seeing these problems they too will likely encounter – more than half of Generation Z-ers say they want college to teach them more practical life skills, such as financial planning and saving for the future

The number one goal for 94 percent of millennials is paying off debt or becoming debt free.

Impact? Future GDP may suffer if millennials become misers.

Troubled over their debt and financial situation, many young adults are delaying marriage until they are on stronger financial footing. While this may curb births in the United States, there may be a silver lining: the divorce rate dropped 18 percent from 2008 to 2016.4 While baby boomers continue to divorce at unusually high rates, experts say that young adults who marry today have a greater chance of a lasting relationship than marriages even 10 years ago. Another finding is that among those with less money and less education, fewer are getting married but are raising kids and living together.5

Impact? “Marriage is becoming a more durable, but far more exclusive, institution.”6

So somewhere down the road, consider what might be attractive to a debt-free, independent-minded single millennial. Well, 42 percent say they’d like to take extended time away from work. Right now, only 5 percent of employers offer paid sabbaticals (Facebook offers 30 days of paid time off every five years), but this could change as more young people enter the workforce.7

As more young adults become engaged in voting and influencing government policies, U.S. paid time off may start to resemble that of Europe and Australia, where workers get a mandatory minimum of 20 days paid vacation after their first year on the job.8

Impact? U.S. paid time off policies may start to shift.


Content prepared by Kara Stefan Communications.

1 Joshua M. Brown. The Reformed Broker. July 25, 2018. “How do you start a life these days?” Accessed Oct. 18, 2018.

2 Ibid.

3 Ryan Jenkins. Inc. Sept. 25, 2018. “This Is the Type of Debt Millennials Have.” Accessed Oct. 18, 2018.

4 Ben Steverman. Bloomberg. Sept. 25, 2018. “Millennials Are Causing the U.S. Divorce Rate to Plummet.”

Accessed Oct. 18, 2018.

5 Ibid.

6 Ibid.

7 Kathryn Mayer. Employer Benefit News. Oct. 16, 2018. “The 15 most popular employee perks.” Accessed Oct. 18, 2018.

8  Niall McCarthy. Forbes. June 26, 2017. “American Workers Get The Short End On Vacation Days.” Accessed Oct. 18, 2018.

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