The Great Recession created a millennial generation gap.
The Great Recession has divided millennials into two distinct groups — those who took the greatest hit from the recession and dealt with a tough job market, and those who experienced the recovery period, entering a better job market. In a nutshell, the oldest millennials went through the eye of the storm, while the youngest millennials caught the tailwind, Dorsey said.
Dorsey called the Great Recession an "extremely formidable and difficult event" for the oldest millennials. Older millennials are still recovering from the recession, while younger millennials have more time to plan financially, he said.
It put older millennials at risk of becoming a "lost generation" in terms of wealth accumulation.
"The Great Recession led to a very tough job market, wage stagnation for those that had jobs, student-loan debt that was increasingly hard to pay, and rising costs of living around the country," Dorsey said.
By watching the recession unfold, younger millennials became risk-averse.
Since younger millennials didn't experience the financial crisis directly, they were able to observe it — and learn what to do and what not to do, financially speaking.
According to Dorsey, they got the benefit of learning from older millennials without having to go through some of the economic pain the older cohort experienced — and from which that cohort is still recovering. This has made younger millennials more aware of the risks of a bad economy and more practical when it comes to money, from saving for emergencies to contributing to a retirement account, Dorsey said.
Because the financial crisis put millennials behind, they're delaying major life milestones.
Regardless of age, millennials are working hard to catch up financially. Northwestern Mutual's Planning & Progress Study 2018 found that millennials are more likely than other generations to say they're "highly disciplined" or "disciplined" financial planners.
The crisis "created a perfect storm of high unemployment, stagnant wages, and the declining value of American homes [which] meant that families had fewer resources to use to pay for college," she wrote.
Millennials in the graduating class of 2018 have an average student-loan debt of $29,800. The weight of this debt is further hindering millennials' ability to save and also contributing to their delay in life milestones. In fact, more than half of indebted millennial respondents in an INSIDER and Morning Consult survey said attending college wasn't worth the student loans.