Way to Go, Millennials. You’ve Doubled Your Average Net Worth During the Pandemic
Sep 01, 2022 brooklyn,Brooklyn Buyers,brooklyn real estate,brooklyn realty,Brooklyn Renters,Buying in Brooklyn,financial planning
Yes, you read that correctly. Millennials have been working hard since the world changed in 2020. The average net worth of millennials more than doubled, jumping to an impressive average of $127,793 in recent years. But that doesn’t mean money has been coming easy. Read on to learn more about this wealth, what to do if you’re not feeling the impact, as well as what you can do to maximize it for your future.
Where is the Millennial Wealth?
Thanks to low interest rates throughout the pandemic, millennials invested in record numbers of primary homes and rental properties. And thanks again to rising home prices, their equity went up at the same time.
If you were a part of this movement but you don’t feel the impact, you’re not alone. This generation’s assets still lag behind Gen Xers and Baby Boomers, who are coming in at over $600,000 and over $1,000,000 respectively.
Millennial debt is also high, which might prevent some from feeling the impact of their assets.
How Can Millennials Maximize Their Wealth?
Experts offer plenty of advice on this subject, but the bottom line is focusing on cash flow. Instead of building your real estate net worth and nothing else, watch where your money is going. Funding a retirement account is more important than another real estate transaction in many circumstances, for example.
It’s also recommended to diversify your wealth. Be sure you’re paying into your 401k and receiving your employer’s maximum match. Aim for up to 15% of your paychecks if possible.
Once you have home equity and retirement savings, invest 20-25% of your monthly income in long-term investments. This type of diversified portfolio will bring high returns in the long run.
And if you’re in need of funds, a Home Equity Line of Credit is a great option. You can borrow from money that is already yours in equity, instead of credit cards with high interest rates.
All in all, millennials have done an incredible job with finances in a time that wasn’t easy to do so. We may not have it as good as previous generations, but we’re figuring it out for ourselves nonetheless. And if you’re one of those millennials that is ready to add to your generational wealth via real estate, get in touch! We know all the right tips & tricks.