- The oldest millennials turn 40 this year.
- They have less wealth, more debt, and about the same earnings as past generations at their age.
- They straddle the digital worlds of old PCs and today’s social media apps.
- See more stories on Insider’s business page.
The oldest millennials enter middle age this year.
The generation turns ages 25 to 40 in 2021, per the Pew Research Center’s definition. Like everyone, millennials are aging. But it’s a hard concept to grasp when the media narrative has painted millennials as young, frivolous 20-somethings who love selfies and can’t afford anything because they spend too much money on avocado toast.
It’s an inaccurate picture of the entire generation, which has been shaped by technological advancements and a broken economy. But the typical 40-year-old millennial especially doesn’t quite align with this image. Many feel they embody some characteristics of both Gen X and millennials, having experience with both analog and digital worlds.
Millennials are known for battling a series of economic challenges, from student debt to the Great Recession. The typical 40-year-old millennial bore the brunt of the financial crisis, leaving them with less wealth and more debt than past generations at their age. But, compared to their younger generational peers, they have less student debt and are more likely to own homes and have kids – a sign that many have been able to recover from the financial fallout.
Here’s what life looks like for the typical 40-year-old millennial.
When the 2007 financial crisis began, the 40-year-old millennial was 26, an age at which most of the generation hadn’t yet accumulated substantial wealth. It’s this cohort that bore the true brunt of the financial crisis,which left lingering effects a dozen years later when the coronavirus recession rolled around.
From the very beginning of their careers, they entered a dismal labor market that set them up for a long recovery.
“Millennials have lifelong damage, given the severity of the Great Recession,” Mark Muro, a senior fellow and policy director at the Brookings Institution, previously told Insider, adding that “older millennials were squarely hammered.”
Their early post-graduate years were marked by a tough job market that led to wage stagnation. The typical 40-year-old millennial earns $73,000 a year.
Boomers earned around $72,000 at that age, while Gen X earned around $68,000, according to a Bloomberg analysis of Federal Reserve data. That is all to say: wages have remained stagnant since 1989.
Wages haven’t kept up with soaring living costs for everything from healthcare to housing, creating a financial imbalance that’s been difficult for the 40-year-old millennial to rectify.
It’s made building wealth difficult. With a net worth of $91,000, the typical 40-year-old millennial is only 80% as wealthy as their parents were at their age.
At age 40, Gen X was worth $94,000. Boomers held $112,000 in wealth at that age, per Bloomberg.
But the oldest millennials are catching up. A 2018 St. Louis Fed study originally found that those born in the 1980s have median levels 34% below older generations, causing the Fed to deem them at risk of becoming a “lost generation” for wealth accumulation.
“Not only is their wealth shortfall in 2016 very large in percentage terms, but the typical 1980s family actually lost ground in relative terms between 2010 and 2016, a period of rapidly rising asset values that buoyed the wealth of all older cohorts,” the 2018 report read.
A follow-up study in 2021 found 1980s millennials gained some ground, narrowing their wealth deficit to 11%. “It turns out that millennials may not be as ‘lost’ as we once thought,” according to the report.
They also have $128,000 in debt. While some of this may be from student loans, they don’t carry the weight of student debt as much as younger millennials
This debt is way more than what Gen X and boomers had at age 40 — $94,000 and $112,000, respectively, per Bloomberg.
One might first look to student loans as the source of this debt. College tuition has more than doubled since the 1980s, and student-loan debt reached a national high of $1.5 trillion in 2019. Many millennials are shouldering their share of this burden.
The typical 40-year-old millennial entered college in 1999, and graduated in 2003 (under a typical four-year plan). According to an analysis by the research team at Education Data, 73% of students graduating that year took out a student loan. That year, the average debt at graduation per student was $16,070, equivalent to $22,170 today.
But that’s not as much as the typical youngest millennial, who turns 25 this year. They graduated with about $29,500 in student debt.
It’s likely a good chunk of that debt comes from a mortgage. The typical 40-year-old millennial owns a home.
According to an Insider analysis of 2019 American Community Survey microdata from the University of Minnesota’s IPUMS program, 61.9% of 40-year-old millennials (who were 38 when the survey was taken) own a home.
However, that’s still lower than previous generations at that age: 68% of Gen X and 66% for boomers. As housing prices climbed over the years, millennials began renting longer and buying later. While some have finally been able to afford a house amid low interest rates during pandemic, the demand has exacerbated a historic housing shortage that has pushed homeonwership further out of reach for other millennials.
The homeowning life stage means that most 40-year-old millennials have a mortgage. It aligns with previous findings from an Insider and Morning Consult survey, which found that’s it not just student-loan debt millennials are swimming in. A mortgage is typically their biggest debt, according to the survey.
They also have kids. Achieving these standard life milestones is a sign that many have caught up from the delayed effects of the Great Recession.
“The oldest millennials delayed many of the traditional markers of adulthood, such as marriage, kids, and buying homes, as they went through the eye of the Great Recession and the long and uneven recovery afterward,” Jason Dorsey, a consultant and president of the Center for Generational Kinetics, previously told Insider.
As millennials delay marriage and homeownership, they’ve delayed childbearing until they they felt more financially sound. More women are having kids at a later age than ever.
But as of 2019, 66% of 40-year-old millennials (who were 38 at the time), have kids, according Insider’s analysis of 2019 American Community Survey microdata from the University of Minnesota’s IPUMS program.
But the typical 40-year-old millennial dissociates from their generation. Caught between Gen X and millennials, they almost feel generationless.
As Alisha Tillery wrote for Shondaland, being the oldest millennial “is to be an outlier of sorts, to really have no generation to identify with at all, yet be perfectly okay with not fitting into one box or the other.”
“We are caught in a tight space that remembers the days of old (before Google, Facebook, and YouTube), but is also intrigued by the future and a new way of doing things,” she added.
Jessica Guinn Johnson, an attorney in Baton Rouge, Louisiana, born in 1981, told Tillery, “I never found that I fit in the millennial mold, but identified more with Gen X.”
Robert L. Reece, a University of Texas-Austin sociology professor, told Tillery there’s validity in classifying oneself as a millennial but not identifying with the typical characteristics of the generation.
It explains why the 40-year-old millennial is largely seen as being part of a microgeneration, for which there have been many names.
As Tillery wrote, some millennials feel they better identify with the cusper (someone who straddles two generations) term Xennial. It describes a micro-generation “that serves as a bridge between the disaffection of Gen X and the blithe optimism of millennials,” Sarah Stankorb wrote for Good Magazine in 2014.
In a Medium article that went viral in the spring, author and leadership expert Erica Dhawan called the micro-generation that the 40-year-old millennial falls into “geriatric millennials,” which she defines as those born between 1980 and 1985. What sets them apart, she recently told Insider, is their experience with technology.
The typical 40-year-old millennial remembers PCs, the days of early dial-up, and MySpace, but also feels comfortable on TikTok and Clubhouse.
Whereas younger millennials don’t know a world without digital tools as a primary form of communication, the eldest millennials remember when they were very primitive.
“They were the first generation to grow up with a PC in their homes. They joined the first social media communities on Facebook and MySpace. They remember dial-up connections, collect calls, and punch cards,” Dhawan previously told Insider, adding they also remember things like Napster for burning CDs, as well as the regular flip phone.
But while they’re fluent in the early days of the internet and digital technology, they’ve also been able to easily adapt to newer forms of digital media, like TikTok, which may be unfamiliar to older generations like baby boomers and commonplace among younger generations like Gen Z.
“This is a unique cohort that straddles digital natives and digital adapters,” Dhawan said.
But straddling a digital divide means the typical 40-year-old millennial is an asset in the workforce.
With the skills of both older and younger generations, Dhawan said, they can bridge communication styles in the workplace.
For example, she said, a geriatric millennial would know to send a Slack message to a Gen Z co-worker instead of calling them out of the blue, which they might find alarming. But they would also know to be mindful of an older co-worker’s video background and help walk them through such technology.
“They can help straddle the divide,” she said. “They can teach traditional communication skills to some of those younger employees and digital body language to older team members.”