The Wealth Gap Between Boomers and Gen Z Is Even Wider Than You Think
There’s no denying the wealth inequality in the United States. Even without knowing the exact figures, it’s hard not to see how much young adults struggle financially. Costs keep rising and, while the same could be said of incomes, it’s not of equal proportion.
And then you have generational differences. Even just comparing boomers with Gen Z, there’s a significant wealth gap.
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That gap, though? It might be bigger than you think.
Wealth Gap Between Generations
Today’s younger generations — millennials (born 1981 to 1996) and Gen Z (born 1997 to 2012) — have significantly less wealth than older generations.
As per the Federal Reserve Survey of Consumer Finances, the total net worth by age has seen a steady shift from 1989 to 2024. Back in the third quarter 1989, wealth was split as follows.
$3.86 trillion (70 or older)
$7.59 trillion (55 to 69)
$6.54 trillion (40 to 54)
$2.45 trillion (under 40)
Total: $20.44 trillion
But in the first quarter of 2024 (the latest data available), it now looks like this:
$47.59 trillion (70 or older)
$64.70 trillion (55 to 69)
$30.83 trillion (40 to 54)
$10.15 trillion (under 40)
Total: $153.37 trillion
The Fed doesn’t separate millennials and Gen Z, so the data is inclusive of both generations (with some overlap into Gen X). This means that from 1989 to 2024, those under 40 saw a 314% increase in total net worth.
But what about boomers? These individuals were born between 1946 and 1964, putting them at 62 to 80 years of age. Although the Fed doesn’t split generations, boomers fall somewhere within the 55 to 69 and 70 or older categories. This means they (along with older generations) saw a 881% increase in total net worth.
Put another way, those under 40 currently own just 6.62% of the total wealth. Those ages 55 and older own 73%.
Even in 1989, the wealth gap between generations was substantial, just a little less so. Back then, those ages 55 or older owned 56% of the total wealth. Those under 40 had just 12%.
It’s still a big difference, but younger Americans had a larger slice of the metaphorical pie than they do now. Older individuals have significantly more.
Why the Wealth Gap Is So Substantial
If you want to know why net worth is so different across generations, you need to consider certain systemic factors.
Housing Costs
The cost of housing has skyrocketed over the years. Back in the first quarter of 1964, when the oldest boomers were just reaching adulthood, the median sales price of homes was $18,500, per the Federal Reserve Bank of St. Louis. In the first quarter of this year, the median sales price was $403,200. That’s a 1,968% increase.
Rentals don’t come cheap either. The average U.S. apartment rental goes for $1,750, as per RentCafe. In 1960, it was $799 (in today’s inflation-adjusted dollars), according to the World Data.
Wages
Wages also play a major role in people’s ability to build wealth. Using the U.S. Bureau of Labor Statistics (BLS) data, Econofact found that real median weekly wages rose 19% from the first quarter of 1985 to the first quarter of 2025.
But then there’s inflation and the overall cost of living. According to the Official Data Foundation, the cumulative inflation rate during that same time period was nearly 200%. While not everything rose proportionately, costs are still substantially higher when measured alongside income changes.
Using 2024 dollars, the real median personal income was $28,700 in 1985, according to the Federal Reserve Bank of St. Louis. It’s $45,140 in 2024 (latest data available). That’s only a 57% increase.
Education Costs
Like most everything else, education costs have risen significantly over the past few decades. On average, a college student today can expect to spend $38,270 on tuition, books, supplies and the like, per the Education Data Initiative. This is per year. It’s also more than double what it was in the 20th century.
With Gen Z allocating so much more money to basic expenses, it’s no wonder it’s so much harder to build wealth than it was for previous generations. It’s still possible, of course, but it does require much more planning and income than before. This doesn’t make it any less frustrating, but at least it’s still feasible.
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This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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