Source: Fortune
Summary
A new study by Northwestern Mutual found that more than half of parents (52%) are open to helping their children buy a home, with 22% already doing so. This shift in support is partly due to the decreasing value of a four-year college degree, with recent college grads facing high unemployment and underemployment rates. Instead, parents are rethinking how to position their children for financial success, with some betting on homeownership as a key tool for building wealth. Gen Z is finding itself in a precarious position, with Boomers and Gen X holding the majority of the country’s wealth.
Our Reading
The numbers tell one story. Parents are stepping in to help their kids buy homes, with 22% already doing so. The value of a college degree is falling, and recent grads are facing high unemployment and underemployment rates. Homeownership is becoming increasingly out of reach for young people, with the average age of the first-time homebuyer hitting 40. Ed Amos, wealth management advisor at Northwestern Mutual, says parents are rethinking how to position their children for financial success, with some betting on homeownership as a key tool for building wealth.
Amos notes that the benefits of starting wealth building early in life have tremendous impacts on where their children will be in the next few decades. However, Gen Z is finding itself in a precarious position, with Boomers and Gen X holding the majority of the country’s wealth. The most sustainable path to the American dream requires Boomers to hand over their wealth via more traditional assets like real estate.
It’s becoming less and less accessible to the entry-level employee straight out of college, trying to buy their first home. It’s just becoming more and more difficult for these newer generations to do it on their own.
Author: Evan Null
