Nearly three-fourths of U.S. millennials (72%) have some form of non-mortgage debt, with the average millennial owing $117,000. This is according to a new report from Clever Real Estate that takes a look at why this demographic struggles to afford a home.
To learn more about their economic situation, Clever surveyed 1,000 millennials about their finances, savings and credit history to provide a clear snapshot of how debt afflicts this generation.
Here are the key findings from the survey:
- Among millennials who are debt-free, just 1 in 3 (34%) have never had debt, while 1 in 4 (25%) have paid off their debts within the past year.
- Nearly three-fourths of millennials (72%) have some form of non-mortgage debt, with the average millennial owing $117,000.
- About 63% of millennials believe it will take them one to five years to pay off their debt, while nearly 1 in 10 think it will take more than 10 years.
- Approximately 1 in 16 millennials (6%) don’t think they’ll ever pay off their debt.
- The most common type of debt among millennials is credit card debt, with 67% of those with debt carrying a balance.
- Nearly 1 in 3 millennials (29%) don’t pay off their credit card bill in full every month.
- Of those who have credit card debt, the average amount they owe is $5,349.
- Nearly half of millennials with debt (48%) say they have student loans, with the average respondent owing $126,993.
- The average millennial spends 47% of gross monthly income on housing each month—1.5x more than the recommended 30%.
- More than half of millennials (53%) own a home, but 1 in 6 millennial homeowners (16%) regret their purchase.
- Of those who don’t own a home, nearly 1 in 3 (30%) don’t think they’ll ever be able to afford one.
- Not saving enough is the No. 1 financial regret among millennials (37%).
- One-fourth of millennials (25%) aren’t confident they could afford a $500 emergency expense out of pocket, and one-third (33%) don’t think they could afford a $1,000 emergency.
- About 77% of millennials already have children or want them in the future, but 1 in 4 (25%) say they can’t afford them.
Author’s take:
“Millennials trace their financial struggles to the 2008 economic crisis, when the oldest members of the generation graduated into a market with few jobs available. The stagnant economy depressed wages, leading to lower lifetime wealth and delayed milestones, such as marriage and homeownership,” writes Jaime Dunaway-Seale, content writer for Clever and author of the report. “Millennials—now in their prime working years—were steamrolled again in 2020 when the pandemic-induced recession wiped out stock market gains, retirement savings, and emergency funds built in the previous decade.”
Greater analysis of the Clever survey can be found here in the full report: Millennials Are More Than $100,000 in Debt: 2022 Data.
