By Mike Bodeen · 26 September 2016
Millennial! Is Net Worth Not Worth It? Look Here!
The chart below, published by Motley Fool using data from the Census Bureau shows us the average net worth of an American, segmented by age group. The blue bars represent a person’s net worth which includes the equity they have in their own home. The red bar represents net worth without home equity.
So here’s the message to the millennials out there. Home equity in one’s own home represents 84% of the net worth of the average person 65 year or older.
Some of the reasons why millennials are not buying homes, include having too much debt, including student debt, not making enough money, or not having a sufficient down payment saved up, or uncertainty in their current job security. A non-financial reason for not buying is not wanting to be tied down to a mortgage. They like the idea of being able to move somewhere else without the hassles of selling, especially after seeing family members lose their homes to foreclosure, or who may still be upside down in a mortgage and can’t sell. I think the word is “freedom.”
These are legitimate concerns, but as the chart shows, not building equity can have future consequences. So here’s the message to the millennials out there. Home equity in one’s own home represents 84% of the net worth of the average person 65 year or older. If you do not own a home, you are not building home equity. And down the road of life, that will not be freedom.
If you do not start building home equity at a young age, it can be difficult to catch up later. Please don’t say we didn’t warn you.