How will the wealth of the baby bust generation compare with that of the baby boomers?

Student debt, unaffordable housing and low pensions is the legacy handed down by the early 1960s ‘baby boomers’ to the generation of students just starting at university.

Baby boomer (born in 1963)

 Baby buster (born in 1993)

Wealthier relative to average earnings including:

  • Housing
  • Pensions
  • Other financial wealth

Higher real income and spending in absolute terms (and able to
purchase a wider range of goods and services due to
technological progress)

Able to afford first home at 29 (10% deposit)

Only able to buy first home at 35 (25% deposit)

No student debt

Student debt of around £90,000 (for a medical student with a
full loan in a university outside London)

Can afford to retire earlier (66 vs. 68)

May live longer (but not certain given obesity trends)

Option to leave large inheritance?

Might receive large inheritance?

On the other hand, the report notes that the baby busters are likely to live longer than their parents and to have higher absolute levels of consumption due to being born into a richer society after 30 years of technological progress and economic growth between the early 1960s and early 1990s.

The report reveals stark differences in the economic fortunes of people with similar career paths and life histories from different generations. Relative to average earnings in society at the time, the baby buster generation could be around 25% less wealthy at age 65 than the baby boomers in terms of total accumulated housing, pension and other financial wealth.