- Millennials are making their own way and on their own terms.
- Many Millennials are still unsure about commitments such as buying a house.
Many Millennials are turning 40 (or more than 40!) this year. While this may come as a surprise to other generations, we’ve been talking about Millennials aging up for the last ten years—and now the media is finally noticing. Why is this important? Because it means that Millennials are no longer the youngest, up-and-coming generation—instead, they are now the parents of the next generation!
At the same time, Millennials are now entering their key earning years, home-buying years, and a pivotal life stage for saving to fund their retirement (and hopefully paying down student loan debt, too). Millennials have survived challenge after challenge—from The Great Recession to the current COVID-19 pandemic—and their determination and continual adaptation are going to eventually pay off. At the same time, many Millennials are finally putting down roots for the long haul.
In CGK President Jason Dorsey’s recent interview with The Detroit Free Press, he shared his thoughts on what it means for the oldest Millennials to be turning 40 and older. This is a topic important to him not only because he’s been leading Millennials research for more than thirteen years, but because he is also part of the older group of Millennials, so he is living this experience, too.
Let’s start with the key question: What are we seeing in our Millennials research at The Center for Generational Kinetics (CGK) when it comes to this generation advancing further into adulthood and (gulp!) mid-life? We are seeing Millennials approaching “getting older” with a new determination to continue adapting to whatever comes their way. In a sense, they’ve come this far, so they are ready to keep persisting to get to whatever is next and (hopefully) better.
The oldest Millennials—the ones that are now turning 40-plus—came of age in a true boom and bust time. They saw the promise of the dot com boom but their actual timing for entering the workforce was more aligned with the dot com bust and its aftermath. Then they saw social media take off and smartphones become the norm, and right when many of the oldest Millennials thought they were on the cusp of fast-forwarding their career, they crashed right into The Great Recession. They ended up running headfirst into wage stagnation, high unemployment, rising cost of living, and historically high student loan debt. Talk about a perfect storm of macro challenges.
Our work at CGK shows that 9/11 and The Great Recession were both generation defining moments for many Millennials. The interesting twist is many Millennials felt they had finally, after all these years, recovered from the shockwaves of The Great Recession and were making progress toward their goals until the pandemic hit.
If you’ve heard Jason speak or read his recent books, you know he calls the group of Millennials who feel like they are doing well and moving forward with their life: Mega-llennials. This segment of the generation had broken off from the rest of the generation—who were finding their own path but at a different pace—and now the pandemic has in many cases amplified this split within the generation. In fact, what we are finding is that some Millennials even feel guilty because they may have been more “insulated from the economic impact of the pandemic,” while others “got caught right in the crosshairs” of it. An oversimplified example is the difference in employment realities of a Millennial working in cloud technology in contrast to the ones who worked in a hotel, restaurant, or traditional retail—three industries which suffered dramatic employment losses during the pandemic (while cloud technology hiring continued to grow rapidly).
Millennials Are Making Their Own Way and On Their Own Terms
While the split within the Millennial generation continues to play out, the resolve of many in the generation to keep working, juggling, and building their self-reliance cannot be ignored (though it frequently is in the media even as Millennials are the largest generation in the workforce!). For some Millennials, during this pandemic, they have taken on extra work, paid down debt, and even improved their credit score, while others are trying new things to navigate this difficult time, including moving back in with parents to save money.
One interesting storyline of The Detroit Free Press article is that the pandemic has forced some Millennials to “start growing up.” The abrupt change from working in-office or on-site at a job to working from home (and maybe even their parents’ home) forced many Millennials to take a new look at their life and lifestyle from a different perspective.
While creating a more professional background for your workplace Zoom meetings from your living room may be a sign of adulting, one of the biggest reasons some Millennials still feel they haven’t hit full adulthood status yet is their personal finance situation. For many in the Millennial generation who needed to bounce back from The Great Recession, they are still trying to catch up—and in a pandemic, no less.
Yes, Millennials have had better access to personal finance tools and education as a result of mobile apps and online financial wellness solutions, but they still need to earn more while limiting their bills. Even though there are many great apps for tracking and improving credit scores, savings, budgets, and investing, many Millennials still feel unprepared to meet their retirement goals.
Now add to the mix a mountain of student loan debt that many worry they will spend the rest of their lives repaying, and a belief within the generation that Social Security will not fund their future retirement, and it’s easy to see why many in this generation—particularly those who are not Mega-llennials—feel stuck or frustrated in reaching their financial goals.
Despite the setbacks many Millennials have crashed into, it’s also clear that many in the generation are trying to take on more responsibility to find their financial footing and help future generations (including their kids!) learn from their experience.
Many Millennials Are Still Unsure About Commitments Such as Buying a House
Even as the older part of the generation is turning 40+, many in the generation still have not decided if they want or will even be able to afford to buy a house given their financial situation and life plans. Some researchers even dub the generation, Generation Rent. In fact, in 2019, 49% of all renters in the U.S. were Millennials. But we are beginning to see Millennials buying homes, particularly older Millennials who are also more likely to have two-income households and/or be further along in their career.
According to a Harris Poll, 59% of older Millennials are purchasing houses, even if it means they have to borrow from their retirement accounts, credit cards, and parents to do so, particularly when it comes to the down payment.
For many in the Millennial generation, they say that their lives feel less predictable than those of past generations. However, no matter how unpredictable their lives may feel, many Millennials also feel like they have a better work-life balance. In part, this could be because many believe their identities are not as closely tied to their work or job as previous generations.
While our work studying Millennials continues to evolve with the generation, one thing is sure: Millennials are here to stay and they are no longer the young kids on the block. For many in the generation that is completely fine, too. Especially since their kids are now the young ones on the block!
If you’ve enjoyed this perspective and are curious to know more, especially the impact of Millennial parents and Gen Z’s emergence, check out Jason’s new book: Zconomy. The book was a Top 10 Business Book of 2020 on Forbes and it reveals a ton of unexpected insights that you can use to understand and bridge generations.
We look forward to sharing more findings with you on what the future holds for Millennials and emerging generations.