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If you’re a millennial, you’ve likely heard your boomer parents (or even silent generation grandparents) tell stories about how they bought a house in their 20s, paid off their education, and still had enough left over in their checking account to vacation, send the kids to college, and even buy a second home.

Meanwhile, you’re just hoping your landlord doesn’t raise the rent again this year. It’s not that we’re bad with money — it’s that we’re playing a whole different economic game.

Let me give you some context. My grandparents, part of the silent generation, owned a home, put two kids through college, took vacations, saved for a comfortable retirement, bought a beach house, and left money to their grandchildren. My grandfather was a dentist, and my grandmother was a speech pathologist.

Then, my parents, part of the baby boomer generation, bought a home in their 20s, put three kids through college, went on vacations, and bought a second beach house by age 40. My dad was a doctor, and my mom was a stay-at-home mom. They weren’t struggling.

Now? As a millennial, despite making what seems like decent salaries, it feels as if we’re constantly battling to keep up with our personal finances and not run afoul of our budgets. Why? Let’s dive in.

Salaries are lower

Here’s the hard truth: millennials earn 20% less than baby boomers at the same stage of life. Specifically, median earnings for people aged 18 to 34 are lower than they were in the 1980s.

And let’s not forget the ripple effects of the Great Recession, which threw many millennials into precarious contract and freelance positions with inconsistent hours and pay. So, while we’re hustling, our paychecks aren’t nearly as reliable as those of previous generations.

As if that wasn’t bad enough, Gen Z’s dollars today have 86% less purchasing power than baby boomers’ dollars when they were in their 20s.

The cost of living is higher

Now, let’s talk about the elephant in the room: the cost of living. It’s no secret that housing prices have skyrocketed. Millennials and Gen Zers pay nearly 100% more on average for their homes than baby boomers. The median home price in 2022 was $370,600, compared to $185,600 (adjusted for inflation) in 1970. That’s nearly double!

Why the massive jump? Partly because of the rising Consumer Price Index (CPI), but there’s another factor — baby boomers aren’t selling their homes at the same rate, creating a supply issue driving up prices. So, even though Gen Z and millennials want to buy homes (it’s not that we’re all about renting forever), the market is tougher than ever.

For those of us still renting, things aren’t much better. The median rent is up 150% since 1970. This means millennials are stuck in a vicious cycle. Paying high rent makes it harder to save for a down payment on a home, and while housing prices briefly dipped during the Great Recession, rent didn’t budge.

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Tuition costs are higher

Oh, and don’t forget the cost of education. My mom always tells me she was able to put herself through college as a waitress. Millennials, however, are looking at an entirely different scenario. With over $1.7 trillion in educational debt across the country as of 2022, it feels like we’re shouldering a financial burden that just won’t go away.

The cost of college has outpaced income growth by a long shot. Since the 1970s, public school tuition costs have increased by 310%, and private school tuition has jumped by 245%. In the 1970s, one year of public college tuition cost an average of $2,768. Today? It’s $11,360. That’s a massive difference and a major reason why so many millennials are trapped in a cycle of debt before they even get their first job.

Basic costs are higher

It’s not just housing and education that have become more expensive — everything costs more. Millennials and Gen Zers are paying 57% more per gallon of gas than baby boomers did in their 20s. Groceries? Same story. Wages, on the other hand, haven’t kept up with inflation.

In 1970, the typical American income was $24,600 per year (adjusted for inflation), but the average consumer price index (CPI) was a low 38.8. Wages rose steadily over the next 30 years, reaching $38,700 in 2000 — a 57% increase. But now? Wages have stagnated, while the cost of everything from avocado toast to auto insurance has exploded.

What millennials can do

The reality is that millennials are navigating a financial landscape that’s vastly different from what boomers experienced. But that doesn’t mean all hope is lost. Here are some ways to cope:

• Automate your savings and investments: Set up automatic bank transfers to save and invest consistently, even if it’s a small amount.
• Maximize employer benefits: Contribute to employer-matched retirement plans to build your future savings.
• Consider a side hustle: Leverage your skills for extra income outside your primary job.
• Prioritize debt repayment: Focus on paying off high-interest debt first to reduce financial strain.
• Refinance debt: Explore refinancing options to lower monthly payments or interest rates.
• Seek affordable housing: Consider buying in up-and-coming areas or negotiate rent to reduce long-term costs.
• Adapt to the economy: Stay flexible with your financial strategy to navigate the changing economic landscape.

It’s not that millennials aren’t working hard; the economic landscape has dramatically shifted. We’re earning less, paying more, and often working in jobs that don’t provide the stability our parents enjoyed. Between skyrocketing housing costs, the cost of higher education, and the ever-rising cost of living, it’s no wonder millennials are feeling the pinch.

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