Millennials’ average net worth doubled during pandemic, report finds

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Covid-19 relief and record-low interest rates boosted many Americans’ finances during the pandemic. That has been especially true for millennials, who have on average built significant wealth.

Millennials, born between 1981 and 1996, have more than doubled their total net worth, reaching $9.38 trillion in the first quarter of 2022, up from $4.55 trillion two years prior, according to a MagnifyMoney report.

And millennials’ average net worth — defined as total assets minus total liabilities — also increased twofold during the same period, jumping to $127,793 from $62,758, the report found.

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However, the report finds the average millennial net worth still lags behind older generations, with Gen Xers and baby boomers reaching an average of $647,619 and $1,021,264, respectively.

Real estate more than a third of millennial wealth

I would encourage millennials to focus more on their cash flow than net worth in this stage of their careers.

DJ Hunt

Senior financial advisor with Moisand Fitzgerald Tamayo

“I would encourage millennials to focus more on their cash flow than net worth in this stage of their careers,” said certified financial planner DJ Hunt, senior financial advisor with Moisand Fitzgerald Tamayo in Melbourne, Florida.

He said millennials may be “losing financial ground in the long run” if monthly mortgage payments prevent them from fully funding their retirement accounts.

Of course, the definition of a fully funded retirement account varies by individual, Hunt said.

While older millennials in their early 40s should aim to max out 401(k) contributions at $20,500 in 2022, younger workers should deposit enough to receive their company match, striving for up to 15% of gross income, he said.

Diversification is ‘name of the game’

Although owning and living in your home serves an important purpose, diversification is “the name of the game,” especially for younger investors with more time to build assets, said Eric Roberge, a CFP and CEO of Beyond Your Hammock in Boston.

If most of your wealth is home equity, it may be wise to focus on building retirement plans or a brokerage account, he said, suggesting 20% to 25% of gross income annually for long-term investments. 

“For many people, a diversified portfolio will likely provide higher returns in the long-term,” he said.

Applying for a home equity line of credit

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