Young, pretty & broke: are twenty somethings financially challenged?

By Rosie Earl

The landscape of work is changing all the time, are the 20 somethings disadvantaged for being born too late?

Millennials (those who grew up during the 90s and 00s) are working side by side with the baby boomers and the gen-xers, but could be more disadvantaged than their older counterparts. With millennials being more likely to have a degree than previous generations, you would expect the young to be swimming in cash, so why do they appear to be struggling more than ever before?


Disposable Income - Context

The Office of National Statistics has researched disposable income of breadwinners in different age groups since 1986, and although the results are positive for all groups, the younger workers are getting the short end of the stick. In 1986, someone in their 20s was had an average disposable income of £17,029 whereas someone 60+ was playing with £15,758. By 2015, the 20 somethings had a disposable income of £25,378 (an increase of 49%) whereas the 60 somethings now have £31,019, which is a 97% increase. In fact, since 2002, the youngest people been the poorest, being hit particularly hard during the financial crisis in 2008.


A lot has changed since the 80’s - the haircuts, for example. The dawn on the internet age has given the millennials a bad reputation, which some perceive as the reason why we’re struggling. Bad news, millennials - everyone hates us. Seen as slackers, self-obsessed and entitled, it can be harder for a millennial to get a promotion when trying to impress and older boss. In a study by EY, young workers are seen as lacking in experience and executive presence, so is it any wonder they might be earning less?


Millennials tend to focus more on their personal happiness than working long hours, and (as you’d expect) less work equals less money. As the old saying goes, money doesn’t buy you happiness, and young people are following this to the letter. With value placed on beauty, experiences and life being short, millennials may actually be choosing poverty to chase their dreams.

The Economy

Since the 1980s, the economy has been on a bit of a rollercoaster. Before the financial crisis in 2008, interest rates were high, and people with savings or those who had bought properties when they were super cheap were all set up to make a killing. Unfortunately, in 2008, a now 25 year old was 17, and would have been more interested in Robert Pattinson’s eyes than an ISA. That means by the time they got financially savvy, the interest rates were low they were just as well sticking their money in a piggy bank as a savings account.

Small Survey Sample

One important thing to take into account is that less 20 somethings are breadwinners, therefore there are less people in the group to examine. In 2008, when 20 somethings has an average disposable income £26,322, 1 in 5 (around 2.7 million) were living with their parents. By 2015, 1 in 4 (around 3.3 million) were now choosing to live at home, rather than having a home of their own. This could be because the average property now costs upwards of £210,000, which could be far too much for someone low on the earning ladder. The cost of actually flying the nest means less 20 somethings may be breadwinners, by necessity rather than choice.

Top Takeaway

Today’s 20 somethings are earning less now than the same age group did when they were born. They’re more likely to live at home, have more focus on happiness than money, and be viewed less favourably by older generations. Also, high house prices mean less 20 somethings are leaving home than ever before, meaning there are less breadwinners to statistically consider in 2016.

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