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Parents Build Wealth, Adult Kids Stagnate
Posted By Carole Fleck On March 19, 2013 @ 10:12 am In Bulletin Today,Money & Savings | Comments Disabled
A widening gap is emerging between those over and under the age of 40 when it comes to saving money, owning a home, curbing debt and building a retirement nest egg . Those under age 40 have stagnated while their parents’ generation has accumulated wealth, according to research from the nonprofit Urban Institute .
Average household net worth nearly doubled from 1983 to 2010 for the older set. But for those born after 1970, their average inflation-adjusted wealth in 2010 was 7 percent below similarly aged individuals in 1983.
Sure, the stock market meltdown and housing bust took a toll on older and younger adults alike over the last decade. But the researchers say these younger households were generally falling behind even before the deep recession.
They endured stagnant wages and paltry job opportunities, reversing the pattern that each generation  does better than the one before.
The situation for today’s adults in their 30s and younger is even worse, the research finds. Their net worth is only about half what their parents’ net worth was at that age.
“If these generations cannot accumulate wealth, they will be less able to support themselves when unexpected emergencies arise  or when they eventually retire,” the researchers say.
They recommended that lawmakers create tax policies and other incentives that help younger households grow their assets and build retirement savings .
The research, “Lost Generations? Wealth Building Among Young Americans,” used the 1983 to 2010 data from the Federal Reserve Board’s Survey of Consumer Finances.
Photo credit: mynameisharsha via flickr.com 
Article printed from AARP: http://blog.aarp.org
URL to article: http://blog.aarp.org/2013/03/19/parents-build-wealth-adult-kids-stagnate/
URLs in this post:
 Image: http://blog.aarp.org/wp-content/uploads/2013/03/3074177116_0ac875f0f0.jpg
 retirement nest egg: http://blog.aarp.org/2013/02/08/retirement-plans-rejiggered/
 research from the nonprofit Urban Institute: http://www.urban.org/publications/904574.html
 generation: http://www.aarp.org/technology/social-media/info-02-2012/connecting-generations.html
 unexpected emergencies arise: http://www.aarp.org/work/retirement-planning/info-02-2012/how-much-do-you-need-to-retire.html
 build retirement savings: http://www.aarp.org/money/investing/info-05-2012/catch-up-on-retirement-savings.html
 mynameisharsha via flickr.com: http://www.flickr.com/photos/mynameisharsha/3074177116/sizes/m/
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