'Generation rent' have half the money of those a decade older

Poorer generation: Today's 30-somethings are worth half of those just ten years older
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Chloe Chaplain30 September 2016

People now in their 30s are half as wealthy as those born 10 years earlier after enduring high housing costs, lower incomes and poorer pensions.

Those born in the early 1980s are on average worth £27,000 each – almost half what those born in the 1970s were worth at the same age.

A new report has revealed that the 30-somethings of today missed out on the higher incomes enjoyed by previous post-war cohorts.

They were also too late to benefit from the rising house costs and generous pension schemes provided by employers.

In addition, many in their late 20s find themselves spending more of their net income on rent than home owners do on mortgages.

Yet the difficulty buying a property leaves them stuck with renting and spending double per month than they would on mortgage payments.

Jessica Lucas, 27, told the BBC that most of her friends are not able to save enough capital to put down a deposit for a house in the first place.

“A lot of them are struggling - working full time, sometimes working two jobs - and that's just to rent,” she said.

“Renting alone is causing us a lot of trouble to save up for a house, so I don't know how we're going to get out of the vicious cycle of renting to then own.”

Adam Snape, 36, added that renting is now “the norm”.

“It's getting a lot more like Europe. It is becoming a bit of a daydream that people can buy a house,” he said.

The Institute of Fiscal Studies report is the first to combine housing, financial and private pension wealth as well as yearly income.

Andrew Hood, author of the report said the financial restrictions endured by those born in the eighties will make it difficult for them to ever accrue the same level of wealth as their predecessors.

He said: “Sharp falls in home-ownership rates and in access to generous company pension schemes, alongside historically low interest rates, will make it much harder for today’s young adults to build up wealth in future than it was for previous generations.”

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