Average American Net Worth by Age: Millennials

With the younger half of this generation just starting out in the workforce and the older half entering their prime earning years, here’s a look at how this group has grown and stayed affluent.

Average Net Worth of Millennials

Millennials are classified as those born between 1981 and 1996; The oldest of this generation are in their early forties, the youngest in their mid-twenties. Many members of this generation are reaching their higher earning years, starting or building families, businesses, and becoming homeowners.

According to the Federal Reserve’s 2019 Survey of Consumer Finances, millennials have an average net worth of between about $76,000 and $436,000. And according to a 2022 report, millennials more than doubled their total net wealth, reaching $9.38 trillion in the first quarter of 2022, up from $4.55 trillion two years ago.

How do millennial wealth compare to other generations?

Compared to other generations, the average millennial’s net worth surpasses only that of Gen Z. The average millennial under the age of 35 has a net worth of about $76,000; The over 35s top out at over $400,000. Generation X members have an average net worth of between $400,000 and $833,000, and older generations, including the Baby Boomers and Silent Generation, have an average net worth of over $1 million.

“Millennials make more money than any other generation their age, but have far less wealth because the cost of living outpaces wage increases,” said Molly Ward, certified financial planner at Houston-based Equitable Advisors. “Also, since Boomers married young, there were often two wage earners in a household, so net worth increased. Millennials often live off a salary as they may not marry young or marry at all.”

What Shaped Millennials’ Wealth and Financial Future?

For many millennials, the journey to wealth accumulation has not been without its challenges. A rising inflation rate, higher cost of living, and several economic downturns have made growing their wealth a little harder for members of this generation.

The massive indebtedness from student loans has made it difficult for this generation to accumulate wealth

College is significantly more expensive than it used to be, and millennial wallets have felt the burn. According to a study by Georgetown University, college tuition has increased 1,375% since 1978, more than four times the headline inflation rate.

While Gen Z holds the title of carrying the most student loan debt of any generation, a similar percentage of Gen Zers and Millennials carry over $50,000 in student loan balances. Steep student loan balances have caused many members of the millennial generation to delay or completely write off important, wealth-building milestones like saving for retirement or home ownership.

Data from Bankrate shows that 68% of millennials who took out student loans for their college education were delaying a major financial decision because of their debt. That’s higher than older generations: About 54% of Gen X and 42% of Boomer borrowers said they delayed making a major financial decision because of their student loan debt.

Millennials have survived two financial recessions in their lifetime

Millennials experienced two recessions before age 40 that significantly impacted their job prospects, earning potential and ability to pay off debt – and entered the labor market during one of the most challenging labor markets. For millennials between the ages of 16 and 24, the unemployment rate peaked at 19% during the 2007-09 recession, compared to a peak of 7% to 9% for older generations.

The COVID-19 pandemic has also thrown this generation back and significantly reduced the wealth that this generation has built during its recovery period. According to the same Georgetown University study, 38% of millennials have received or sought financial help or assistance during the pandemic, and 35% said they spent their savings or delayed saving/paying off debt.

Wages have not kept pace with the cost of living

According to data from the US Census Bureau, the median pre-tax household income of Millennials in 2020 was $71,566, and many workers of all generations report not earning enough. Two-thirds of American workers say their salaries are lagging behind inflation, and the percentage of workers considering quitting a job is at a four-year high, according to a new CNBC poll in partnership with Momentive.

3 ways millennials can increase their wealth

Experts say there are ways members of this generation can get back on track and build their wealth.

• Make a plan to pay off student debt. Student loan debt can be a massive drain on your net worth unless you make a plan to consistently reduce your debt. Debt repayment strategies such as the snowball or avalanche method can help you better understand your loans and interest rates, and how best to approach your debt according to your income and repayment style.
• Make sure you have adequate insurance coverage. Insurance is the safety net that protects your finances and your most important asset when the unexpected happens. Ensuring you have enough coverage to protect all of your assets is key to maintaining a strong net worth. “There could be significant setbacks to your future if you lose your ability to earn an income during those years due to disability or the death of your spouse. If you have children, make an education cost plan if it’s important to you,” says Ward. “Your insurance plan needs to be solid.”
• Do not hesitate with your retirement provision. Don’t leave retirement money on the table. Ward suggests maximizing your employer-funded retirement account so you can take advantage of any contribution adjustments your employer may provide. In addition to maximizing this game, it’s important to save consistently over time – no matter what the market is doing. “For Gen Z and Millennials, market volatility can actually be a good thing,” says Kendall Meade, certified financial planner at SoFi. “By making regular contributions to their investments and retirement accounts, they take advantage of these fluctuations. A recession can actually be a great buying opportunity.”