MARY LOUISE KELLY, HOST:
Millennials were dealt several challenges right on the verge of adulthood - rising college costs, the Great Recession, the pandemic. So how does millennial wealth stack up against the generations who came before them? Greg Rosalsky from our Planet Money podcast reports.
GREG ROSALSKY, BYLINE: Ana Hernandez Kent is considered a young millennial - old enough to have friends who still wear skinny jeans, yet young enough to have friends who still spend too much time making videos on TikTok. She may have been born in the '90s, but she's definitely not Gen Z.
ANA HERNANDEZ KENT: I absolutely refuse to get on the new trend of, like, parting my hair down the middle. I'm not a fan of that.
ROSALSKY: Kent is a senior researcher at the Institute for Economic Equity at the Federal Reserve Bank of St. Louis, and she's spent the last few years studying millennial wealth, specifically the wealth of older millennials born in the 1980s. For the year 2016, she found that typical millennial family had around $28,000 in wealth. That's about 40% less wealth than what previous generations had when they were the same age.
HERNANDEZ KENT: Forty percent behind - that's pretty substantial. And we questioned whether they would become a lost generation - right? - these older millennials.
ROSALSKY: Many millennials left college with lots of student debt and entered a job market ravaged by the Great Recession. For others who didn't get college degrees, it was harder to find good-paying jobs than it was in the past. All of that would have lasting consequences, and Kent and her colleagues began to worry. Are millennials destined to be poorer than the generations before them, like, forever?
Last year, new data came out, and they jumped at the chance to see how millennials, now in their mid-30s, have done.
HERNANDEZ KENT: Have they fallen further behind? Have they gotten closer to where we would have expected them to be?
ROSALSKY: First, the good news. The wealth of the typical millennial family did jump substantially from $28,000 in 2016 to $51,000 in 2019. The typical millennial family is still behind compared to previous generations, but it's getting better. There's now just an 11% gap. But the picture looks much different when you break it down by race. The typical white millennial, they have a lot more wealth - $88,000. Black millennials are faring much, much worse.
HERNANDEZ KENT: So the typical Black millennial, older millennial, has about $5,000 in wealth. That is very, very little wealth to be able to weather an economic crisis, to be able to plan for the future whatsoever, let alone a down payment on a house.
ROSALSKY: She says white millennials are more likely to have parents who help them out financially. They're more likely to have paid off their student loans. They're more likely to own stocks. And while about two-thirds of white millennials now own homes, less than a third of Black millennials do.
HERNANDEZ KENT: That's incredibly shocking because Black Americans have made great progress in terms of political representation, job protections. But it doesn't seem to be translating into wealth gains.
ROSALSKY: And Kent's research is especially troubling because Black millennials aren't only trailing white millennials. They have 52% less wealth than what previous generations of Black Americans had at the same age. And this data was all collected before the pandemic. Greg Rosalsky, NPR News.
[Editor's note: This interview with Ana Hernández Kent was recorded on April 15, before the Federal Reserve's current media blackout.]
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