The Cost of Living is Skyrocketing for Future Generations

Oct 26, 20212 min read

The issue

Living costs for Millenials have soared substantially since the 1900s. Millennials, when compared to older generations, are typically confronted with more struggles in terms of financial endeavours.

Fortunately, some living costs have been lowered which has helped millennials minimize their financial troubles. For instance, the price of gas has decreased over the last 40 years, and the minimum wage has been rising since the 1970s. Although lessening these financial burdens is beneficial, it is simply not enough when compared to the increasing costs of housing and education.

A major way in which the issue occurs: housing

To adapt alongside inflation, the value of homes has increased by 73% since the 1960s. According to Insider, comparing that time period with the 20th century, the difference in the median price of a house is roughly $71,000. Furthermore, a study researched by Student Loan Hero found that today’s aspiring homeowners are required to pay 39% more than one would in the 1980s. In turn, millennials will need to spend more time-saving money prior to placing a down payment on a house they wish to call home.

Whilst saving money, millennials are still tasked with finding a place to live. As houses are costly, the next viable option would be to rent a living space, yet the cost of rent has increased greatly as well. An example is in the United States: the average cost of rent grew from $588 in 1960 to $866 in 2000 and to $1600 currently, as stated by Zillow, an American real estate marketplace company. Consequently, the dilemma is rendered more complex; much of a millennial’s paycheck will go towards rent, meaning, the process for saving money to purchase a home is elongated.

A major way in which the issue occurs: education

The cost of acquiring an undergraduate degree has also grown. The College Board concluded that in the years it took for millennials to complete a K-12 education, tuition at public schools grew by 213% and private schools by 129%, ultimately resulting in an increase in student loans. Student Loan Hero states that just in America, there are 44 million student loan borrowers, with roughly $1.7 trillion as a sum of their collective debt.

The Silver Lining

With many barriers to face, millennials have a far greater financial struggle in comparison to older generations. However, these financial struggles have also caused adjustments in a millennial’s lifestyle and in doing so, created silver linings. For one, younger generations are becoming more “financially savvy”, as believed by Insider. Unconventional ways of earning money are being explored: earning side income from stocks as a practice is becoming more common, and more people are getting part-time jobs as a large abundance of small businesses have recently been established. All in all, millennials have found creative ways to adapt, even in the midst of exponentially increasing living costs.

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Published September 30, 2021

Written by Katherina Pan ~ Edited by Scarlett Chu ~ Graphics created by Laiba Muhammad

The Cost of Living is Skyrocketing for Future Generations

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