US baby boomers now sit on a whopping $85.4T in wealth. Expert says they’re leaving younger generations ‘worse off’ and behind. But is that true?

The aggregate fortune of this group dwarfs every other generation. Baby boomers collectively hold 51.1% of the nation’s wealth, compared with just 10.7% for millennials (1).

That gap, analysts say, not only supports a far more comfortable lifestyle for older Americans but also limits younger workers’ ability to build assets of their own. The result is a generation entering midlife with far less financial security.

Here’s why experts say this generational wealth inequality is leaving younger Americans worse off.

Pulling up the ladder

Experts suggest that much of boomer wealth, which is primarily concentrated in the housing and stock markets, was accumulated under very different economic circumstances.

In 1980, when this generation was either starting out or had young families still, home prices were much more affordable. The median home price was roughly $65,000 (3).

Not only did this make homeownership more affordable for boomers, it also allowed them to save money to invest in the stock market, which was also relatively cheaper at the time. The S&P 500 traded at a price-to-earnings (P/E) ratio of approximately 7.4 in 1980, meaning investors were paying $7.40 for every $1 of earnings generated (4).

Today, the median home price sits at $410,800 (5), and the S&P 500 trades at a P/E ratio of about 31 (4). In other words, millennials and Gen Z face much higher barriers to entry, while dealing with a higher cost of living that squeezes their ability to save.

And the situation is unlikely to improve anytime soon.

"One critical thing boomers and older generations have also done is pull up the housing ladder behind themselves by adopting NIMBY [not in my back yard] tendencies over the last several decades," Jake Krimmel, senior economist at Realtor.com, said recently (6).

According to Krimmel’s analysis, boomers held 30% of the nation’s total wealth and 40% of its real estate assets in 1995. “It really is the case that boomers have been on top for their whole adult lives, leaving other generations behind and worse off," he said.

If you’re young, the odds might be stacked against you. But that doesn’t mean you can’t try to tilt them in your favor.

How to improve your odds

Despite the structural headwinds, there are still some ways ordinary young Americans can get ahead.

One of the most effective steps is investing in high-value skills that lead to well-paid careers.

According to the Bureau of Labor Statistics, the fastest-growing six-figure occupations projected through 2034 include nurse practitioners, data scientists, information security analysts, medical and health services managers, actuaries, physician assistants, computer and information research scientists and postsecondary health specialties teachers (7).