While it might seem like the economy is on an upswing, there are still many financial pitfalls holding people back prosperity—or even stability. Credit card debt, student loan debt, stagnant wages, and increasing home prices are all keeping hard working Americans from climbing out of a financial hole.
For nearly every generation, especially Millennials, the effects of the Great Recession, in addition to the above challenges, are still deeply felt. However, one generation might have finally recovered from the shock: Generation X.
Gen X’s Net Worth is on the Rise
According to a Pew Research Center analysis of Federal Reserve data, Gen X is the only generation to have recovered the wealth they lost during the Great Recession and housing crash. Although Gen X was newer to the housing market at that time and more likely to have purchased a home at peak prices, which issued a major hit to their net worth during the recession, their median net household worth has risen 115% since 2010.
In 2016, the net worth of a Gen X household surpassed its 2007 value, while median net worth values for Baby Boomers and the Silent Generation/Traditionalist households remained below 2007 levels.
Gen X Recovers Home Equity Losses
The Pew report also noted that only Gen X has fully recovered the home equity lost in the recession, with an equity level that’s doubled since 2010. As of 2016, only 3% of Gen X homeowners are still “underwater,” meaning they owe more than they own.
Boomers and Traditionalists have not seen that rebound in home equity. And while Millennials are still reeling from the recession in some ways (chief among them the astronomic interest rates on their student loans), most did not own property during the recession, so they didn’t have much wealth to lose at the time.
Gen X is entering a crucial life stage where they are currently becoming the primary caregivers for their aging parents, so any ground they can gain on property values will be a boon for them. It will be most interesting to see if and when Millennials can climb out of the Great Recession slump, and how that will affect the economy as a whole.
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