The wealth gap between generations in the US has nearly doubled in the past 20 years, according to a MagnifyMoney study.
The study found that millennials have seen a small decrease in net worth when compared to the same-aged cohort 20 years ago.
Baby boomers, meanwhile, have seen a significant increase in their net worth, when compared to the same-aged cohort 20 years ago.
Millennials are facing an affordability crisis, in which the Great Recession, expensive housing market, and staggering student-loan debt have put them financially behind.
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Look no further than the widening generational wealth gap to see just how financially behind millennials are.
The average American millennial household today (ages 20 to 35 in 2016) has an average net worth of $100,800, while the average American baby boomer household today (ages 52 to 70 in 2016) has a net worth of $1.2 million, reported Mallika Mitra for CNBC, citing a MagnifyMoney analysis of Federal Reserve data on household assets and liabilities (all values are adjusted for inflation). That means that baby boomer households in 2016 had twelve times the net worth of millennial households.
A gap in wealth between these age groups makes sense because baby boomers have had more time than millennials to accumulate wealth — but comparing that wealth gap to those of previous generations shines a new light on the findings.
In 1998, the average household aged 20 to 35 had a net worth of $103,400, while households aged 52 to 70 had a net worth of $747,600, MagnifyMoney found — roughly seven times more than the younger households.
That means the wealth gap between older households and younger households has nearly doubled in the past 20 years, climbing from seven to twelve times the net worth.
In that time frame, the average net worth for households ages 20 to 35 has declined by $2,600, while households ages 52 to 70 have seen a $452,400 increase in net worth.
Read more: Millennials have been called the ‘brokest’ and the ‘richest’ generation, and experts say both of those are true
The Great American Affordability Crisis is to blame
As a refresher, net worth is one’s entire personal assets minus all their liabilities. MagnifyMoney’s analysis reveals that millennials have more liabilities — debt — than any other age group studied.
Much of that debt takes shape in student loans, …read more
Source:: Business Insider