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70% of Millennials Are Living Paycheck to Paycheck: Survey:
Millennials' wallets are rather skimpy.
Seventy percent of the generation said they're living paycheck to paycheck, according to a survey by PYMNTS and LendingClub, which analyzed economic data and census-balanced surveys of over 28,000 Americans. It found that about 54% of Americans live paycheck to paycheck, but millennials had the biggest broke energy.
By contrast, 40% of baby boomers and seniors said they live paycheck to paycheck, the least of any generation. Living paycheck to paycheck reflects economic needs and wants just as much, if not more than, incomes or wealth levels, according to the report. Age and family status also factor in greatly. This explains why millennials, who turn ages 25 to 40 this year, are struggling.
[...] It doesn't help that millennials have faced one economic challenge after another since the oldest of them graduated into the dismal job market of the 2008 financial crisis. A dozen years later, many are still grappling with the lingering effects of The Great Recession, struggling to build wealth while trying to afford soaring costs for things like housing and healthcare and shouldering the lion's share of America's student-loan debt.
The pandemic threw yet another wrench into their plans by giving them their second recession and second housing crisis before the age of 40. The report acknowledges that the pandemic played a major role in that stretched thin feeling.
[...] It seems, then, that it's a combination of external economic circumstances, a precarious life stage, and some spending habits that are leaving millennials feeling strapped for cash.
(Score: 2) by Dale on Wednesday September 29 2021, @01:07PM (2 children)
I agree with the commenters that have said most people just plain suck at managing money. That being said, this statistic shouldn't really surprise anyone. 20 years ago Gen X'ers were in the same boat. I think it is more of a function of where they are in their careers, family, and social situations moreso than a dramatic difference in spending habits. 20-25 years ago I still had debt I was paying down, car loans, etc. I was driving a less reliable car and had car repairs that killed the monthly budget and other emergencies that were just difficult to accommodate. 20-25 years later those are not issues any longer. I have no debt, a reliable-ish car, plenty of savings. I've gone from that stage in life where I'm just trying to establish myself and get things going to pushing hard on future savings for retirement (20% 401(k) contributions finally hit recently after years of pushing from 10% upward). I'm not saying the Millennials haven't had their share of crap to deal with, but this particular metric is just where they are in the life cycle at the moment.
(Score: 3, Insightful) by Phoenix666 on Wednesday September 29 2021, @01:38PM
Like most things, there are many factors that contribute to an emergent phenomenon. You nailed a large part of what's bedeviling the Millennials now. I would add that people in their age range are the cohort that advertising targets most heavily. They are literally being brainwashed to blow through all their money, and it works. You couple that with the removal of economics, civics, and personal finance from most public school curriculums and you have graduates who are completely ignorant of finance and business unless they have family who are CFAs or CPAs who teach them how.
We've been trying to train our kids to manage money and to be makers instead of consumers, ie. when they want something we point to tools and materials and tell them to make it (we also do work with them to get them started, because we're not completely heartless). Who knows if it will ultimately take, but at least we try. Those of us who are older can at least do that for the struggling Millennials and those who follow them--show them there's another way.
Washington DC delenda est.
(Score: 2) by srobert on Wednesday September 29 2021, @02:14PM
"20 years ago Gen X'ers were in the same boat"
I'm a Boomer so I'm thinking about 40 years ago. I was working fast food, or as a cashier in a department store, or phone sales. I wasn't good at managing cash because none of those jobs paid enough to meet my basic needs. I was a parasite in my dad's house because I barely made enough money to get transportation to and from the jobs I had. 20 years ago I had a blue collar union job which was much better, modest savings, and a little debt. Worked my way through college in my 30's, and now closing in on 60, I have professional status and save about half my income toward retirement. Still, if I could have made a better income when I was at the bottom, I think it would have been better for me even now. My annual income profile has a steep curve. If I'd had my way I'd have flattened, while keeping the same area under the curve. Some of what I have now, would have been more useful to me when I was young.