The millennial generation comes in for a lot of flack. It is the clean-living generation, mocked as much for its Instagram obsession as it is for its snowflake-like sensitivity.
But a glance at Credit Suisse’s Global Wealth Report shows just what it is up against. Since the downturn, house prices have soared and salaries have stagnated. However, according to the report, millennials are just as obsessed with owning a home as their predecessors: indeed, the pattern of saving for a house before beginning to build up so-called financial assets, such as pensions, is a “special problem” for them.
So they are behind on saving for a pension. And by the time they need it, the state is unlikely to help: by 2060, state pensions will replace just 20 per cent of per capita income, compared with 35 per cent today. Meanwhile, fewer than 10 per cent of workers born in the 1980s have a final salary pension, compared with 40 per cent of those born in the 1960s.
In one stark indicator of how the situation has changed, the report suggests every generation born after 1955 had less wealth in 2013 than their predecessors had just five years earlier. “It is quite likely that a cohort that experiences bad times early in its life cycle is at a lasting disadvantage,” the report warns.
Of course, there are many reasons to be cheerful. Millennials are healthier than any generation before them. They have access to cheaper goods, travel and experiences, live in a more peaceful world and are better educated: 43 per cent of 25-34 year-olds had a university education in 2016, compared with 15 per cent in 1970. And at the outer edges, some are richer, too: the number of under-40s listed in Forbes’ top 100 billionaires list rose from 24 in 2010 to 46 in 2017. So that's something.
But the report throws into stark relief why, after years of helping hands for the older generations, there is increasing pressure on the chancellor to use next week’s Budget to provide some relief for the young, with measures such as a stamp duty holiday for first time buyers.
After punishment from high house prices, stagnant salaries and lower-for-longer interest rates doing little to augment their savings, the snowflake generation deserves a break.
- The author of this piece is a proud millennial snowflake.