Will my kids do better than I did?
Whether kids still out-earn their parents, student debt, and housing for young families, the American Dream, measured.
The American Dream, measured: can your kids out-earn you, can young families still buy a home, and is each generation building more wealth than the last.
Will your kids earn more than you did?
The odds have collapsed. 92% of kids born in 1940 out-earned their parents; for those born in 1984, it's 50%, a coin flip.
This is THE American Dream chart. The decline from 92% to 50% is driven primarily by the distribution of growth, not the rate of growth, Chetty found that redistributing the same GDP growth more equally would restore mobility to ~80%.
⚠ Some researchers (Davis, Minneapolis Fed) find a smaller decline (~3pp vs 21pp for the 1942-64 cohorts) when relaxing the copula stability assumption. Present Chetty's numbers as the primary finding but note the methodological debate exists.
How long must you work to afford a home?
Longer than ever. A median home now costs about 5.5 years of median income, up from ~3 in the 1990s, and the worst on record.
⚠ Ratios are approximate using NAR median existing-home price ÷ Census median household income. Doesn't account for mortgage rates, which dramatically affect monthly payment affordability. A ratio of 3.0 was historically 'normal'; 5.5 is unprecedented.
Can young people still buy a home?
It's harder than it was for their parents. Under-35 ownership fell from ~44% (2004) to ~39% today; Boomers at that age were near 65%.
⚠ Values are from Census CPS/HVS via USAFacts, ConsumerAffairs, and Wealthvieu analyses. Some years are interpolated from nearest available data. Cross-check against Census HVS Table 7 for exact annual figures.
How old are people when they buy their first home?
Older every decade. The median first-time buyer is now 38, up from 29 in 1981, and the oldest on record.
NAR reports median age of first-time homebuyers has risen from 29 (1981) to 38 (2024), the oldest on record.
Is each generation building more wealth than the last?
No. Millennials at age 35 hold roughly 40% less wealth than Boomers did at the same age, adjusted for inflation.
- Millennials at age 35 have roughly 40% less wealth than Boomers had at the same age in real terms.
- Median net worth ~$120,000 (inflation-adjusted to 2024)
- Median net worth ~$95,000 (inflation-adjusted to 2024)
- Median net worth ~$70,000 (inflation-adjusted to 2024)
- Fed SCF is conducted every 3 years. Exact same-age comparisons require careful vintage matching. These are approximate from DFA and academic analyses of SCF microdata.
⚠ Full generational comparison at matching ages requires direct SCF extraction by birth cohort. The Fed's DFA provides some quarterly generational data but doesn't perfectly control for age. The direction and magnitude of the gap are consistent across analyses.