Millennials are killing countless industries - but a new report says it's only because they're poorer than their parents

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A new study reveals that millennials aren't that different from Gen X or Baby Boomers in how they spend their money - they just have less of it.

• Millennials are "dramatically financially worse off" than older generations, according to a new study by Deloitte.
• Millennials' spending is the same as their parents when it comes to the proportion of their income going to things such as food, restaurants, and alcohol - they just have less money to spend.
• Since 1996, the net worth of American consumers under the age of 35 has fallen by 34%.
• Millennials are spending more on non-discretionary expenses, with the cost of student debt growing by 160% since 2004.
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A new study reveals that millennials aren't actually different from Gen X or Baby Boomers in how they spend their money - they just have less money to spend.

Millennials have been blamed for the murder of industries from golf equipment makers to razor manufacturers, as sales have tumbled in recent years.

"They are often branded as being more narcissistic, more idealistic, more socially-conscious, and more experience-oriented than any of their preceding generations," reads a Deloitte study published this week. "They have even been blamed for ruining everything from movies to marriage!"

However, the study - written by Kasey Lobaugh, Bobby Stephens, and Jeff Simpson - ultimately debunks many of the narratives about millennial consumers.

Deloitte's survey of more than 4,000 consumers, 450 billion points of location data, more than 200 billion credit card transactions, and government data revealed that millennials spend their money on roughly the same things that their parents did 30 years ago.

However, millennials are "dramatically financially worse off" than older generations. Since 1996, the net worth of American consumers under the age of 35 has fallen by 34%.

The financial crisis and college debt - not avocado toast - are changing how millennials spend their money

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Millennials don't spend more money on food than older generations.

Money spent on food, alcohol, and restaurants accounts for roughly the same percentage of millennials' income as these categories did in 1997. In other words, millennials aren't skipping out on homeownership because they're wasting their money on avocado toast.

"In many ways, the consumer hasn't fundamentally changed," Kasey Lobaugh, Deloitte's principal and chief retail innovation officer, said in a statement. "Instead, their behaviors have been triggered by a rise in non-discretionary expenses and the growing bifurcation between high and low income groups."

People spent 16% more on housing in 2017 than 2007. Health care costs increased by 21% in the same period. Education spending skyrocketed by 65% as student debt soars. Since 2004, the cost of student debt has grown by 160%.

All in all, 17% of 25 to 34 year olds' income went towards these non-discretionary costs in 2017, compared to 12% in 1997.

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Education costs are skyrocketing.

The rise in non-discretionary income has hit lower-income millennials especially hard. The bottom 40% of American consumers had less discretionary income in 2017 than they did a decade prior. The next 40% didn't do much better, with only the top 20% seeing meaningful income gains.

Looking at the growth in incomes over the last decade for a higher-income group of households, making more than $100,000, compared to a group making less than $50,000 reveals just how stark this difference is. Income growth for the higher-income group between 2007 and 2017 rose 1,305% more than the lower-income group.

Deloitte's conclusion echoes a 2018 study from the Federal Reserve that found millennials had fallen behind economically because they came of age during the financial crisis.

Read more: Millennials are killing countless industries - but the Fed says it's mostly just because they're poor

"Millennials are less well off than members of earlier generations when they were young, with lower earnings, fewer assets, and less wealth," the study said, adding, "Conditional on their age and other factors, millennials do not appear to have preferences for consumption that differ significantly from those of earlier generations."

Average real labor earnings for male household heads working full time were 18% and 27% higher for Gen Xers and baby boomers when they were young compared with millennials, the study found. For young women, the difference was smaller - 12% for Gen Xers and 24% for boomers - but earlier generations were still making more money when they were younger among similar demographics.

Millennials have less money to spend than Boomers and Gen X had when they were the same age. With less money to spend, they're forced to be choosier. Certain purchases - such as a car or a home - remain out of reach for many, forcing a further shift in how millennials spend their money.

While millennials may be sending certain industries' sales into freefall, the Fed and Deloitte come to the same conclusion - the economy, not the generation's personal preferences, is to blame for millennials' killing spree.