Based on the most recent U.S. Census Bureau data, the average salary for a millennial is $47,034 a year, or $905 a week. If you fit into this generation, it probably won’t shock you to learn that the average salary of a millennial today is an estimated 20% lower, in real terms, than the average salary that a baby boomer had at the same age. What’s more, today’s millennials are in deeper debt than their parents were at their age.
A financial advisor can be a great resource for millennials looking to put together a financial plan.
How Much Do Millennials Earn?
Before we dig too deep into the average salary of a millennial, let’s define what a millennial actually is. Depending on who you ask, you might hear that a millennial is anyone who was born between 1982 and 2004. Others define millennials as those born between 1986 and 1995. Whatever the exact boundaries you choose, you’ll notice that many millennials came of age during the Great Recession and have earned lower salaries as a result.
To find the average earnings of millennials, SmartAsset worked through extensive data from the U.S. Census Bureau. We counted millennial Americans as anyone who was between the ages of 25 and 34 as of 2018. Based on these data points, we found that the average salary of a millennial is $905 per week, which equates to $47,034 per year. That’s based on mean income data for both sexes and all races, including white, Hispanic, black and Asian.
That number doesn’t get you very far in some of the country’s biggest cities, where the income needed to pay the average rent can easily reach six figures. It’s not surprising, then, that so many millennials are pessimistic about their chances of surpassing the living standards that their parents’ generation enjoyed.
Other Factors That Affect Millennial Earnings
Millennials lost a lot of ground due to the recession, when wages were depressed. Those who have pursued college degrees usually have higher earnings. But those benefits often come with a heavy debt burden in the form of public and private student loans. However, there is an growing sentiment that student loan debt forgiveness may become a reality in the U.S. someday.
As a result, millennials’ debt levels are keeping them from forming households and buying property. In fact, even when you disregard student debt, the picture isn’t particularly rosy. According to U.S. Census Bureau data, the median earnings for full-time workers age 18 to 34 were $35,845 in 1980. By 2000 the same cohort was earning $37,355. For the period of 2009-2013, however, full-time workers between 18 and 34 had median earnings of just $33,883.
According to the Pew Research Center, millennials surpassed baby boomers as the country’s largest generation. However, in terms of their earnings, millennials seem unlikely to catch up to them. Pew found that “the household income of young adults with less than a bachelor’s degree has declined in real terms since 1984.” By contrast, real earnings for young adults with a college degree increased by $1,300 in inflation-adjusted dollars between 1984 and 2009. The increase rose to $1,500 for those with a master’s degree, while anyone with a professional or doctorate degree saw a $3,400 jump.
The quandary many millennials faced is that they knew they needed a degree to boost their earnings, but they couldn’t get a degree without taking on massive amounts of student debt. Unfortunately, that’s a story that the numbers for basic average salary don’t fully illustrate. As such, millennials may benefit from working with a financial advisor to ensure they stay on track for retirement despite being saddled with debt. SmartAsset’s free matching tool makes it easier to find a financial advisor to work with who meets your needs.
Tips for Saving for Retirement
- It can be difficult to know where to start planning for retirement, especially if you’re playing catch-up on saving money. Working with a financial advisor can be a great first step. SmartAsset’s free matching tool can pair you with as many as three advisors in your area.
- Start early. The sooner you start saving for retirement, the more you can reap the benefits of compound interest.
- Don’t forget to take Social Security income into account when you’re figuring out how much you’ll need to save. SmartAsset’s Social Security calculator can help you figure out how much you’ll receive in annual payments.
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