How millennials are rewriting the American Dream

Millennials are approaching once-traditional milestones of the American Dream differently than previous generations. And differently could mean later — or even not at all. 

Whereas baby boomers and Gen Xers bought their first homes in their late 20s or early 30s, the median age of a first-time home buyer last year was 38, the National Association of Realtors reported. Millennials are also getting married later and most are moving in with romantic partners before they do so. 

Plus, a growing number of millennials and Gen Zers say they don’t plan to have children at all. The US fertility rate hit a historic low last year, and a survey from the Pew Research Center shows that the majority of younger child-free people say they “just don’t want to” have kids. 

Reconsidering the order for the American Dream isn’t so baffling anymore. 

“I don’t subscribe to that timeline,” said Georgia Jablon, a 32-year-old public-relations manager in Philadelphia. “When I was in my 20s, I thought I was older. I thought, ‘I’m in my 20s and I should be doing all these things,’ and at that time, I felt more of my own pressure. And now, six years later, I don’t feel rushed. There are people who say, ‘Oh, you’re 32 — are you engaged? Are you thinking about kids?’ and it doesn’t bother me.”

If millennials’ money isn’t going to weddings, houses, or kids, where is it?

Looking to the future

Plenty of younger people say they just can’t afford to check the traditional boxes that their parents may have.

Home and rent prices are astonishingly high and housing inventory remains low. Prices for day care, schooling, and other childcare costs vary widely across the US, but parents agree: they’re only getting more expensive.

But millennials are actually saving money — often even more than previous generations did at similar ages. Even with dollars adjusted for inflation, they tend to be better positioned financially than boomers and Gen Xers were in their 20s and 30s, a study from Lending Tree found. They’re paying down their debt, investing judiciously, and staying on track for retirement. 

“I just don’t think our generation is doing things as planned as our parents did,” said Martha Janeski, a 35-year-old marketing manager living in Denver. “I always tell people, ‘My story is done a little bit backwards.’”

Janeski and her boyfriend recently purchased their first home in Denver, but the circumstances weren’t those she’d once imagined. They were able to strike a deal with her landlord to buy the century-old home they were living in before it was demolished for multimillion-dollar duplexes. When she was younger, Janeski assumed she’d be married, or at least engaged, before taking such a big step. Before the opportunity came up, she’d wondered at what age she’d be willing to trade her city lifestyle and love of travel for cheaper housing options back in Pennsylvania, where she grew up.

“I made a little pro and con list in my head,” she said. “There’s a lot of comparison and I have to remind myself about the grass always being greener on the other side.”

When it comes to momentous life events like starting a family, Jablon said she wants to feel more financially secure before taking on such an enormous responsibility.

“My friends who do have kids say that going out to eat is $200, even if the kids eat chicken fingers,” she said. She’s building up her personal savings so that one day, when she’s ready, those costs won’t be such a burden.

Fear of missing out 

Marketers have long trumpeted the millennial love for “experiences,” and it turns out there’s some truth to that. A globe-trotting trip was once the stuff of honeymoons and retirement vacations; now, every June it seems Instagram is full of photo carousels of summer trips to Europe.

After paying rent, managing her bills, and handling other urgent life expenses, Jablon said she spends the most on travel and experiences. She recently took a trip to Napa Valley with a group of friends, and in the future she hopes to visit Switzerland and Iceland.

When she considers why travel and experiences are such important financial priorities for herself and others, she acknowledges the “sad” reality of online peer pressure.

“Social media, the world of influencers, this world of people online showing big, beautiful homes and weddings and Euro summers — it makes you want that more,” Jablon said.

You could credit some of millennials’ spending and saving to a culture shift or a change in values, but a lot of it may also be driven by economic realities, Daniel Sullivan, research director at the JPMorganChase Institute, said.

“Some things have gotten more expensive, like housing, especially in urban areas,” he said. “But some other things are less expensive. For example, airfares are 35% cheaper than they were in the ’90s, adjusted for inflation. So when we think about changes in behavior, maybe I rent for a while longer and travel more because the relative prices of those things have changed.”

Millennials’ love of living for the moment started young, Harmon Kong, a California-based wealth manager, said. 

“Millennials’ parents came from a consumer-spending generation: ‘Let’s buy stuff; let’s collect things; let’s have a garage full of stuff,’” he said. “But millennials are saying, ‘We don’t want stuff and we don’t want to wait until we’re old and gray and bought the house and raised the kids to have life experiences.’”

Mistrust of the future 

As of 2022, 99.3% of millennials had assets like cash, property, or investments. Gen Xers and boomers had fewer assets when they were the same age, a Lending Tree study showed. Similarly, millennials’ net worth was 8.4% higher than that of Gen Xers and 46.2% higher than that of boomers at similar ages.

Yet many still fear they’re not doing enough to protect themselves against financial catastrophe, said Emily Luk, founder of financial platform Plenty.

“One of the things that feels very consistent when I’ve talked to couples is that there’s almost a mistrust of the future,” Luk said. “It feels like you need more money — and I do think healthcare is more expensive, houses are more expensive, you need more for retirement. There is this feeling of, ‘I need to be putting more aside than people are saying.’”

Millennials entered adulthood in the midst, or immediate aftermath, of the 2008 financial crash, and the ripple effects from that disaster have had far-reaching effects. They cherish experiences and sock more into savings because they’re afraid of what could happen some day in the future, Luk said.

Paul Wezner, a 40-year-old father of two living in Detroit, said he often feels overly critical of his household spending, even when he’s meeting his financial goals, a feeling many millennials can sympathize with.

“In any given month, I’ll be like, ‘We’re not saving enough. We need to be not spending as much,’” he said. “Then at the end of the year I’ll do a check and we’ll say, ‘Well, it’s OK. The 401(k)s are going up. The college kids’ savings are going up.’”

Luk said she talks to numerous users on her platform about their concerns and fears, and many say they prioritize saving over unlocking more stops on the American Dream road map.

“In a world where things feel more uncertain — climate change, politics — people are saving at a much earlier point,” she said. “It’s only what they can do.”

Julia Carpenter is a freelance reporter and the author of “The New Rules of Money.”