In recent years, there has been a lot of talk about how inflation is impacting different age groups. Some people believe that Millennials are hit the hardest by inflation due to the rising cost of living and student loan debt.
Quick personal loans make it difficult to save money, and the cost of key items like housing and healthcare continues to increase.
Millennials are definitely being hit hard, though. According to the U.S. Bureau of Labor Statistics Consumer Price Index (CPI), consumer prices have been up 9.1% since July 2021. That includes a 10.4% increase in food prices and a 59.9% increase in the price of a gallon of gasoline.
Financial Stress Is More Intense for Millennials
People in their 20s and 30s are building careers, establishing long-term relationships, and buying houses. The cost of doing those things was already high. In 2022, it’s reached another level. Putting gas in the car to go to work every day is a challenge. Younger millennials struggle more. They’re still building their career path, so salaries are lower.
The housing market is also a concern. The American Dream of owning your own home is getting more unattainable for millennials as home values increase and inventory is still limited. Meanwhile, the Fed is raising interest rates to “curb” inflation, making it even more difficult to afford a new home. This eliminates a major wealth-building option for this generation.
Vacations Are Becoming Less Affordable
Most people take a vacation when they’re stressed out. Unfortunately, rising prices have made that almost impossible for some folks, particularly those early in their careers making less money. Who can afford to gas up the car and go on a road trip? Airfare used to be cheap, but planes use gas too. Airfare is up 25% since last year.
Even staycations are more expensive. Energy services (natural gas and electricity) are up 19.4%, and it costs 12.2% more to eat at home this year. Sitting in front of the TV, blasting the air conditioner, and munching on refrigerator food sounds great. Paying for it won’t relieve any financial stress. It’s almost cheaper to go to work. Take-out food only went up 7.7%.
Shortages Are Part of the “New Normal”
Baby boomers remember gas lines and recessions. Millennials saw the longest bull market in history unfold during their adult lives. That was before the 2020 pandemic. This year, we’re seeing supply line disruptions, slow economic recovery, and global conflict. Many have called the post-pandemic years the “new normal.” Shortages are part of it.
Some of those shortages are internal because people simply can’t afford what they could in the past. In some cases, items we once bought at the market are no longer in stock or are on backorder. The supermarket shelves have empty spaces on them. That’s a new experience for millennials. Hopefully, we’ll see that turnaround soon.