Rising costs affect everyone. Millennials, however, entered the workforce during the time of the Great Recession. For this reason, millennials have unique financial challenges. Here are just a few of the financial challenges that the next few generations are facing.
Higher Student Loan Debt
Since the 1980s, tertiary tuition has increased substantially. Statistics show that costs have more than doubled since the 0’s, making the cost of tertiary education almost crippling. As a result of these costs being at an all-time high, student loan debt has tipped the scales.
Complaints are claiming that with the increase in costs, the value of the education is not more valuable. Questions around how the Government can validate these increased costs are on-going. What remains is that millennials are still facing loans they cannot settle.
Inflated Living Costs
Many will argue that millennials that are now working have the advantage of earning more in wages than previous generations ever did. While this may be true, the increase in wages certainly doesn’t keep up with the inflated costs of living.
Significant expenses, such as the cost of buying a house, have increased at a more rapid rate. The result is that millennials are having to wait longer to purchase their first home because it takes them longer to save the amount of money they need.
Adding insult to injury, the rising costs of renting properties are not helping. Millennials are having to spend more on renting properties. This has a direct effect on their ability to save for a new home.
When it comes to employment opportunities, millennials prefer to live in highly populated urban areas. Granted, this gives them more freedom and flexibility, but the convenience of renting in a more central area comes with a higher price tag.
Higher Insurance Costs
With millennials taking more time to purchase a home, the trends are greatly increasing in the property rental field. Insurance companies are noticing these changes and are continually developing new products to meet this gap in the market.
Companies like brokerlink.ca understand that the age of the millennials is diverse. Insurance companies are focused on how both the car and home insurance landscape is evolving.
The cost of owning a car, together with rising costs, naturally has increased. Some may argue that more modern cars offer more luxury features than vehicles did in the past. Newer cars are of higher quality. To a large extent, these points are valid.
Unfortunately, the cost of owning a more expensive car equates to higher associated expenses. From the mid-1990s to mid-2000s, the average cost of car insurance rose by approximately 50%.
Conclusion
While millennials face tough times, many economists believe that the trend is changing and will continue to improve. More millennials are now starting to settle into suburban areas. There is still a trend to keep costs to a minimum. This is done by car-sharing and home-sharing. But it is evident that as time passes, these millennials will eventually settle down.
