People in their early 30s, who were born in the early 80s, have an average net household wealth of £27,000, half of £53,000 that those born in the 70s had at the same age.
Research by the Institute for Fiscal Studies (IFS) on household wealth and total income among generations found that those born in the early 80s will face challenges when it comes to building wealth in housing and pensions when compared to previous generations.
The report also found:
- Those born in the early 80s did not enjoy higher incomes in early adulthood compared to the previous generation, the first post-war generation to do so
- At aged 30, only 40% were homeowners compared to 55% of the previous generation
- Those in their late 20s spent nearly 30% of their net income on housing costs, compared to 15% of homeowners with mortgage interest
- Less than 10% of private-sector employees were active members of a DB scheme, compared to 15% of those born in the 1970s and nearly 40% born in the 60s.
Andrew Hood, research economist at IFS, said:
“Sharp falls in home-ownership rates and in access to generous company pension schemes, alongside historically low interest rates, will make it much harder for today’s young adults to build up wealth in future than it was for previous generations.”