Journal Article

The State of Young Adults’ Balance Sheets: Evidence from the Survey of Consumer Finances

Abstract: The authors investigate recent trends in the financial circumstances of young adults using data from the triennial Survey of Consumer Finances (SCF) from 2001 to 2013. They examine trends in young adults? net worth, break down the composition into specific assets and liabilities, and describe young adults? experiences with credit markets. The analysis focuses on three main comparisons: (i) trends over time (ii) between young adults and older adults and (iii) between young adults in 2013 (members of the ?Millennial Generation?) and young adults in 1989 (members of ?Generation X?). They find that between 2001 and 2013, young adults experienced a decline in net worth, driven largely by declines in asset holdings. The median young adult in 2013 also had lower net worth than the median young adult surveyed in the 1989 SCF. Despite media attention surrounding the Millennial Generation?s relatively poor economic outcomes during the Great Recession, young adults in the SCF have fared better on many measures than both current older adults and earlier young adults. Compared with older adults, young adults experienced a relatively modest decline in net worth, particularly during the Great Recession. Young adults in 2013 were also more likely than young adults in 1989 to own homes, stocks, and retirement accounts, and they were less likely to have very high debt payment-to-income ratios than their counterparts in 2001 and 1989 or older adults in 2013.

JEL Classification: D14; D91;

Bibliographic Information

Provider: Federal Reserve Bank of St. Louis

Part of Series: Review

Publication Date: 2014

Volume: 96

Issue: 4

Pages: 305-330