For younger Americans, the old path of saving for a home, settling down and building wealth looks increasingly different from what their parents experienced.
1. Homeownership Is No Longer the Automatic First Move
About 89% of adults under 40 say buying a home is harder today than it was for their parents’ generation. In 2019, 56% of renter households under 40 could afford the monthly cost of owning a home; by 2024, that had fallen to 37%.
2. Some Are Investing Instead of Saving for a Down Payment
A growing number of young adults are choosing to rent while putting money into investments rather than waiting years for a down payment. For some, flexibility and wealth-building have become competing priorities with homeownership.
3. Cars Still Matter—But They Come With a Different Price Tag
Gen Z’s top financial goal for 2026 is saving for a car, with 41% naming it. That suggests the car remains important for younger adults, even as high insurance, financing and ownership costs make the purchase harder to absorb.
4. Dining Out Is Getting Cut First
Bank of America found 64% of Gen Z had taken steps to reduce expenses, including 41% who cut back on dining out and 23% who switched to more affordable grocery stores.
5. Small Treats Survived the Budget Cuts
Gen Z isn’t eliminating discretionary spending altogether. Bank of America’s 2026 research found 92% still treat themselves, with 52% doing so at least weekly—even while 41% experience financial guilt at least weekly.
6. Living With Parents Has Become Part of the Strategy
About 20% of Americans ages 25–34 live with their parents, nearly double the 11.8% recorded in 2005. For many young adults, spending less on housing has become a way to manage today’s unusually expensive path into adulthood.
Sources:
- Pew Research Center, Buying a Home Has Gotten Harder for Young Adults in Most U.S. Metro Areas (Pew Research Center)
- AICPA/Harris Poll, 2026 Financial Goals Survey (AICPA & CIMA)
- Bank of America/Ipsos, 2026 Better Money Habits Gen Z Report (newsroom.bankofamerica.com)
- Urban Institute, High Housing Costs Are Keeping More Young Adults in Their Parents’ Homes (urban.org)