Let’s not sugar coat it – we’re all a bit voyeuristic when it comes to other people’s money. How much do you think they make? How much do you think they have? How did they afford that car? Can you believe that so and so is buying a house?
So let’s focus on one metric – net worth. And let’s talk about millennials – which is likely you, and is me too.
Why millennials? Well, the media seems to portray millennials as broke, unable to pay their student loans, and never able to buy a house. Millennials are supposedly delaying marriage and all sorts of stuff because they are poor and burdened by debt.
I don’t think that’s the case. With anything financially related, there is never an easy answer. But I think there are just as many millennials crushing it financially. I know first hand that some millennials are already millionaires. And the most recent Federal Reserve data shows older millennial net worth is growing at a massive rate.
Maybe the trouble is how we define millennials? Maybe there’s a bigger picture here we need to consider. Maybe we just need to ignore the mainstream media when it comes to wealth. Let’s break it down and then look at the average net worth for millennials.
To keep is easy, the average millennial net worth is $18,000. It’s important to remember that number is skewed given the age ranges, but it’s also a growth over the $10,400 we saw just two years ago. See our charts below.
Note: I originally wrote this article in 2016, and there was no data available to figure out millennial net worth. Over the last few years, several surveys have polled millennials, with the most recent one being Deloitte. In their survey, they found millennials have an average net worth of $8,000 – just shy of our estimate of $10,000.
Regardless of $8,000, $10,000, or $18,000, I strongly urge you to think about the high achiever net worth – trust me, I know plenty of millennials who are way above average and it’s possible.
Who Are Millennials?
Millennials are technically anyone born between 1982 and 2002 (always subject to change – with more people calling those born after 2000 Xennials). Basically, these people are roughly 19 to 39 today. That’s roughly 81 million Americans. We more fully break down the millennial age range here.
What makes them unique as a generation? Well, millennials likely were little kids in a time before computers and cell phones were everywhere. They likely remember getting their first computer and cell phone, and it was a big deal. The likely encountered technology for the first time at school – playing Oregon Trail on a green computer screen. And even today, 64% of millennials are receiving financial support from their parents.
When it comes to money, millennials do have some of the highest student loan debt rates of any generation in history. The average millennial has $30,000 in student loans. See this article on the average student loan debt by graduate class/year.
Depending on when the millennial graduated college, they could have entered a terrible or awesome job market. Remember, some millennials graduated from college before the financial crisis of 2007, some during it, and some after it. When you graduated from college played a huge role in your earnings right out of school.
Millennials are also all dealing with life events at different times as well – from buying a house to getting married, some did it before the recession and some after. As a result, even some older millennials can still be behind. Plus, older millennials who may have started the recovery just got hit with a pandemic, which has resulted in the largest number of unemployed Americans since the Great Depression.
So, it’s really a mixed bag when it comes to millennials. They’re hard to define financially.
But one thing’s for sure – they’re not dumb when it comes to their money. They are combining technology and money like never before (mobile banking, financial apps, etc), and they want their money to work for them. However, the traditional banking and finance sector hasn’t caught up, and millennials really don’t like engaging with traditional brick and mortar finance. As such, there is a divide here.
When looking at net worth for millennials, these are all factors to consider.
Factors To Consider About Millennial Net Worth
When I think of the main factors that fall into millennial net worth, here’s what we need to consider.
First, we need to consider when millennials graduated. If millennials are roughly 19 to 39 today, some haven’t even graduated college yet. However, if you’re 39 today, you likely graduated from college 18 years ago – or 2003. That was before the last financial crisis.
Second, we need to look at the average salaries of graduates by year. NACE has a great survey that they conduct to look at the average salary of college graduates each year. The “Class of” date is the year most of your age group graduated a 4-year college. For example, if you’re 35 in 2021, you likely graduated college in 2007, and high school in 2003. This could be slightly off depending if you’re older or younger for your age, or you graduated high school or college early.
Here’s how that looks:
Third, we need to discuss student loans. Student loans are a huge factor in millennial net worth, so we want to consider the average amount of student loan debt millennials had when the graduated (data here). Just look at the chart below – just within the “millennial generation”, student loan debt has doubled, on average. For current students, I estimated how much student loan debt they’d have currently – with next years graduates on track to set records again.
Average Student Loan Debt
Finally, we do have to make some assumptions about saving. Remember, net worth is all about assets minus debt. But income plays a huge role and how much income is saved and how much debt is payed off really makes a difference. For the “average” millennial, I’m going to look at average savings rates for the calculation. For the above average millennial, we’re going to factor in IRA and 401k savings, as well as home equity.
Average Annual Savings Rate
The Net Worth of Millennials By Age
As we compare the net worth of millennials by age, I want to look at average and stretch goals. I think it’s important to always consider the average, but I also want to leave you with a stretch goal to get yourself in the top 1%.
Remember, net worth is assets minus liabilities. As we discussed earlier, the main assets we’re focusing on is savings, based on income. The main liability is student loan debt.
Also, you have to remember that we’ve seen exceptional growth over the last few years due to a growing economy and bull market. These have helped compound growth at faster levels than can likely be expected in the future.
Finally, I want to re-emphasize that these are just my estimates. The Federal Reserve data lumps everyone under 35 into one bucket, so while we have some starting points, things can always skew one way or another.
With that in mind, here’s the Federal Reserve Data for under 35, and 35 to 44.
- Median Net Worth: $13,900
- Average Net Worth: $76,300
35 to 44:
- Median Net Worth: $91,300
- Average Net Worth: $436,200
However, I think it’s a great starting point for discussion, so let’s jump into it. Remember, we’re pulling and estimating based on some very sparse data points, as well as negative net worth for younger cohorts. This is an estimate! But based on years of experience, we think it’s a fairly accurate estimate.
Average Millennial Net Worth By Age
I tried to make these estimates line up with the real data as best as possible, but most real data points exclude negative net worth for millennials buried in student loan debt. It’s important to note, if you’re comparing this to past charts, the Federal reserve data has shown significant growth in the older cohorts (42%). Our data aligns with this, as these individuals have likely been working and seeing significant investment gains over the last few years.
For reference, the median of millennial net worth is $18,000. The true geometric average of millennial net worth is actually $105,500 – but that number is heavily skewed by outliers like Mark Zuckerberg.
So, what that means is, if you want to be “better” than average, the 50% mark is $18,000 overall. Here you can see my best estimate of the 50% mark by age.
Notes: This assumes that students don’t work or work marginally during school, maintain an average amount of student loan debt, and get average employment after graduation. It’s why you see the net worth jump a lot right after graduation – income! Also, the older millennials have benefited from a bull economy, seeing their small nest egg growing more over the last few years.
High Achiever Millennial Net Worth By Age
Now that you’ve seen what average is, what does it take to be above average? Well, anything better than the chart above is above-average. But I want to give you a stretch goal. I call this the high achiever millennial net worth by age.
How do you get here? A few key areas:
What are some of your thoughts on this? Do you think an 22 year old can have $28,915 saved up and graduate college debt free? I think it’s definitely possible – especially the high achievers that started working at 16 (or earlier) and saved a bunch.
I think that these high achiever net worth amounts are very do-able. They are a stretch, but not unheard of. And these amounts will clearly make you above average.
Notes: There’s a huge jump around the 30 year old range, and that’s all due to the Great Recession. The compounding just didn’t kick in and there wasn’t a big nest egg to start going into it.
Millennial Net Worth FAQ
Here are some common questions when it comes to millennial net worth.
What is the average net worth of millennials?
The average net worth of millennials is $18,000. However, this varies quite a bit across the millennial age range.
What is the millennial age range?
Millennials were born between 1982 and 2002, making them roughly 19 to 39 today.
What is the average millennial starting salary?
Millennial starting salaries vary quite a bit by graduation year. Starting salaries have ranged from $40,818 to $52,569.
What is the average millennial student loan debt?
Millennials have graduated with anywhere $18,217 to $31,000 in student loan debt on average, depending on the year they graduated.
Are millennials doing well?
There is a big divergence in millennial success. Many millennials are doing extremely well, but others are struggling. There are plenty of millionaire millennials, but there are also many millennials in poverty.
How To Boost Your Net Worth
Now that you know the average and above average net worth, how do you get there? It’s time to start looking at ways to boost your net worth.
The great thing is that you’re still young and you have a ton of time on your side. Time is the biggest ally you have in building wealth. But if you want to grow it (and fast), here are two more key areas to focus on.
Boosting Your Income – As mentioned earlier, income is one of the key drivers in building assets and eliminating debt. The more income you have, the easier it is to grow your net worth. I want to challenge you to earn at least an extra $100 per month. We have a great list of ideas to get started. I’m a firm believer that everyone can earn more if they try.
Eliminating Your Debt – One of the biggest struggles millennials have is overcoming a negative net worth and making it positive. Eliminating that student loan debt is key. Leverage your additional income but also look at student loan repayment strategies to help lower that debt.
The fact is not everyone is average or above average when it comes to net worth. But knowing where you stand is incredibly important. It can validate your current financial plan, or it could provide motivation for you to make financial changes in your life.
Don’t be discouraged if you’re not hitting the bar yet. Follow the strategies we discussed and start working towards building real wealth.
What are your thoughts? Are you a millennials that’s above average or below? What do you think is the driver of that?