Millennials have faced significant financial challenges, including inflation, student loan debt, rising housing costs, and a global pandemic. Despite these obstacles, this generation is on track to become the wealthiest in history, according to research from Knight Frank and The Intelligence Lab.
A study by Empower reveals that 2.7% of millennials have reached retirement millionaire status, with retirement accounts exceeding $1 million, averaging $1.74 million.
Millennials Are Building More Wealth Than Ever
Before the pandemic, millennials struggled with debt, making wealth accumulation difficult. According to LendingTree, 88.1% of millennials carried debt—higher than Gen X (86.9%) and baby boomers (85.8%) at similar ages.
However, in 2024, millennials saw the highest wealth growth of any generation:
- Millennials increased their wealth by 14%, more than any other group.
- Their 401(k) balances grew by 15.6%, nearly twice the national average.
- In contrast, Gen X wealth grew by 8.8%, while Gen Z saw a 9.5% increase.
- Baby boomers only saw a 3.8% rise, as many are now spending their retirement savings rather than accumulating more.
Stock Investments Fueled Millennial Wealth Growth
One major factor behind millennial financial success is early stock market investing. According to Empower, millennials started investing in stocks and mutual funds earlier than previous generations. CNBC data shows that millennials began buying stocks around age 25, while baby boomers didn’t start until age 35.
This head start, combined with strong market performance, significantly boosted their savings:
- The S&P 500 has risen 23% over the past five years, compared to a 12.85% return in the previous five years.
- Millennials with 401(k) and brokerage accounts benefited from this surge, accelerating their wealth accumulation.
Pandemic Assistance Provided a Financial Boost
In addition to smart investing, government aid during the COVID-19 pandemic played a crucial role in millennial wealth growth. According to the Federal Reserve, financial assistance programs—including stimulus checks and child tax credits—helped Americans save an estimated $2.3 trillion.
Moreover, historically low interest rates in 2021 (below 3%) allowed many millennials to buy homes at affordable mortgage rates, further contributing to their financial stability.
Millennials Are Overcoming Financial Challenges
While millennials have faced economic hardships, they are proving to be financially resilient. Smart investing, strategic financial decisions, and a bit of luck have helped many reach millionaire status—a milestone once considered unattainable for this generation.
As they continue building wealth, millennials are shaping the future of personal finance, demonstrating that long-term planning and early investment strategies can lead to substantial financial success.
