Nearly half of millennials say they're still crippled by the Great Recession, and it explains why they have less wealth than other generations
- 46% of millennials said they're still financially recovering from the
Great Recession, a recent TD Ameritrade survey found.
- They were more likely than previous generations to feel the lingering effects of the financial fallout.
- Previous research has found that millennials are financially behind and have less wealth than previous generations did at their age.
Millennials are still feeling the burn of the 2008 financial crisis a dozen years later.
Nearly half (46%) of
Millennials were more likely to say they're still grappling with the financial fallout of the recession than both Gen X (43%) and boomers (41%). The feeling underscores previous research that has found millennials are worse off than previous generations.
Millennials born in the 1980s are at the greatest risk of becoming a "lost generation" for wealth accumulation, a 2018 report by the Federal Reserve Bank of St. Louis revealed. As of 2016, people born in this decade had wealth levels 34% below where they would most likely have been if the financial crisis hadn't occurred, the report found. They're the slowest cohort to recover from the Great Recession.
These older millennials went through the eye of the Great Recession and its uneven recovery, graduating into a tough job market and wage stagnation. Coupled with soaring living costs and record-high student debt, this has made it more difficult for them to save.
It might explain why a 2019 Deloitte study found that millennials have an average net worth of less than $8,000. Per the study, Business Insider's Kate Taylor reported, the net worth of Americans aged 18 to 35 has decreased by 34% since 1996, making them "dramatically financially worse off" than older generations.
And a 2019 paper by the Brookings Institution found that millennials are less wealthy than previous generations were at their age at any point between 1989 and 2007. Median household wealth was roughly 25% lower for those ages 20 to 35 in 2016 than it was for the same age group in 2007.
"Millennials are less well off than members of earlier generations when they were young, with lower earnings, fewer assets, and less wealth," a 2018 Federal Reserve study stated.
Jason Dorsey, a consultant, researcher of millennials, and president of the Center for Generational Kinetics, previously told Business Insider that, "Older millennials are often realizing they're going to have to play catch-up with their finances if they want to ever be able to retire."
Now, millennials are facing another financial challenge: the pandemic. It's already eating away at their savings, and it could put the generation even further behind financially.
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