Photo: Jeff Alworth via flickr
Pew released a study today that confirms our worst suspicions about the divide between the rich and poor—Old folks really do have all the money.The discontent felt by Gen Xers and millennials—despite the latter’s notorious dependence on boomers—is often expressed by Business Insider commenters, and now thanks to Pew they’ll actually have some facts to back up their claims.
According to the study’s authors, “households headed by adults ages 65 and older possessed 42% more median net worth (assets minus debt) than households headed by their same-aged counterparts had in 1984,” while adults younger than 35 had 68% less wealth than their counterparts in 1984. It’s a sign the scales have long been tipping in favour of boomers.
There’s no shortage of recessionary trends to blame, but the housing collapse, student loan debt, and a “delayed entry into the labour market,” a huge trend among millennial men, have conspired to hold young people back in more ways than one, despite mounting evidence that college is actually worth it and that more women are entering the workforce and earning higher degrees.
What’s more, say the authors, “today’s young adults are more likely to be minorities and more likely to be single parents,” two factors tied to lower economic well-being. Boomers, on the other hand, have the advantage of inflation-indexed Social Security, their #1 income stream, and are holding on for dear life to jobs they acquired years ago in the face of looming cutbacks and poor employment prospects. This makes it harder for millennials to move up the ladder, much less climb on.
The wealth/age gap also stems from boomer’s luck: Most purchased their present homes at “pre-bubble prices” before 1986, according to the 2009 American Housing survey, and 65% have paid off their mortgage, a feat young American families can only dream about.