Millennials Outpace Parents in Wealth

A recent report by The Wall Street Journal highlights a significant financial turnaround for millennials, a generation previously viewed as struggling to achieve economic stability. The article, titled "The Dramatic Turnaround in Millennials’ Finances," reveals that millennials, aged 27 to 44, are now wealthier than previous generations at the same age. This shift comes after years of skepticism regarding their ability to match their parents' financial success. According to the Journal, the combined wealth of millennials and older Gen Z reached $13.2 trillion in early 2024, a substantial increase from $4.5 trillion in 2020. This growth is largely attributed to rising real estate values. The median household net worth for older millennials surged to $130,000 in 2022, up from $60,000 in 2019, while those born in the 1990s saw their median wealth quadruple to $41,000. Investments in stocks and mutual funds, alongside increased contributions to retirement accounts, have also played a role in this financial progress. Despite these gains, the report cautions that millennials face rising costs in essential areas such as child care, housing, and healthcare. Additionally, with projections indicating longer lifespans than previous generations, financial sustainability remains a concern. However, economists suggest that millennials possess traits conducive to long-term prosperity, including lower birth rates, which may ease financial pressures. As millennials continue to grow their wealth, many are prioritizing savings and investments, with average 401(k) balances rising significantly from $27,600 in 2019 to $59,800 in early 2024, reflecting a proactive approach to their financial futures.