Welcome!

News Feed Item

The Kids Are (Mostly) Alright: BMO Report Suggests Today's Youth On Firmer Financial Footing Than Their Parents Were in the 1980s

- Friendlier job market, slightly higher incomes and more wealth have put young families in a better economic position today than thirty years ago

TORONTO, ONTARIO -- (Marketwired) -- 05/15/14 -- While baby boomers prospered financially in the past 30 years, their kids - despite being saddled with more debt and costlier homes - are set to start their careers and family life on firmer footing, according to a new report from BMO Economics released today.

"There is a popular notion that Millennials will become the first generation to do worse than their parents economically," said Sal Guatieri, Senior Economist, BMO Capital Markets. "However, apart from taking on bigger loans to buy pricier homes, young Canadians today enjoy better job prospects, earn more and are wealthier than in the 1980s."

The report analyzed a number of economic factors to compare Millennials -- those born between 1981 and 2001 -- to the baby boomer generation.

Jobs: Labour markets are friendlier now for young people compared with three decades ago.


--  Millennials looking for a job have a 93 per cent chance of finding one,
    compared with 90 per cent for those in the mid-1980s.
--  Unemployment soared in the early 80s, especially for young people.
    Today, unemployed youth go without work almost a month less than in the
    mid-80s.
--  More young people today either have a job or are searching for one,
    though fewer work full-time.

Incomes: Millennials' higher education leads to slightly higher incomes than their parents.


--  Adjusted for inflation, the median income of people aged 25 to 34 years
    rose from $33,900 in 1984-88 to $34,700 in 2011; Millennials can buy
    about 2 per cent more goods and services than their parents could in
    1984.

"Having 2 per cent more buying power doesn't sound like much, but the difference adds up over time," noted Mr. Guatieri. "One caveat is that median income was higher in the 1970s, before the 1980s' recession took a severe toll on workers, so the starting point for our comparison matters."

Wealth: Young families are wealthier than their parents were three decades ago.


--  Median net worth of households headed by someone aged 25 to 34 years was
    $52,000 in 2012, almost double that in 1984 ($28,752 in 2012 constant
    dollars).
--  For families headed by someone aged 35 to 44 years, median net worth was
    $182,500 in 2012, again about twice as high as in 1984.

Debt: Though wealthier, debt levels are higher for young families.


--  In 2012, 84.4 per cent of those aged 25 to 34 years had debts compared
    with 82 per cent in 1984, and more young homeowners held a mortgage
    (85.6 per cent versus 79.2 per cent respectively)
--  Young people are likely saddled with more student debt, considering that
    tuition costs have risen three times faster than consumer prices since
    1984.

"While young families today have an opportunity to capitalize on favourable financial and economic circumstances, the way in which they manage their higher debt loads will be essential to securing long term financial stability," said Martin Nel, Vice President of Personal Banking Products, BMO Bank of Montreal. "And with interest rates set to rise in the near future, a comprehensive financial plan designed to reduce debt as quickly as possible can help them achieve this."

Housing: Millennials need to pay more to get their foot in the door


--  The average house price was 10.4 times the median income of young
    families in 2011, more than double the ratio of thirty years ago,
    relative to income. Despite double-digit mortgage rates in 1984, young
    homeowners today must pay more to service a mortgage.
--  Many Millennials are priced out of the Vancouver and Toronto detached
    housing markets, or will need to take on large debts to get into them.

The full report is available upon request.

About BMO Financial Group

Established in 1817 as Bank of Montreal, BMO Financial Group is a highly diversified financial services organization based in North America. The bank offers a broad range of retail banking, wealth management and investment banking products and services to more than 12 million customers. BMO Financial Group had total assets of $593 billion and more than 45,500 employees at January 31, 2014.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Historically, some banking activities such as trading have been relying heavily on analytics and cutting edge algorithmic tools. The coming of age of powerful data analytics solutions combined with the development of intelligent algorithms have created new opportunities for financial institutions. In his session at 20th Cloud Expo, Sebastien Meunier, Head of Digital for North America at Chappuis Halder & Co., discussed how these tools can be leveraged to develop a lasting competitive advantage ...
You know you need the cloud, but you’re hesitant to simply dump everything at Amazon since you know that not all workloads are suitable for cloud. You know that you want the kind of ease of use and scalability that you get with public cloud, but your applications are architected in a way that makes the public cloud a non-starter. You’re looking at private cloud solutions based on hyperconverged infrastructure, but you’re concerned with the limits inherent in those technologies.
WebRTC is the future of browser-to-browser communications, and continues to make inroads into the traditional, difficult, plug-in web communications world. The 6th WebRTC Summit continues our tradition of delivering the latest and greatest presentations within the world of WebRTC. Topics include voice calling, video chat, P2P file sharing, and use cases that have already leveraged the power and convenience of WebRTC.
Most companies are adopting or evaluating container technology - Docker in particular - to speed up application deployment, drive down cost, ease management and make application delivery more flexible overall. As with most new architectures, this dream takes a lot of work to become a reality. Even when you do get your application componentized enough and packaged properly, there are still challenges for DevOps teams to making the shift to continuous delivery and achieving that reduction in cost ...
All organizations that did not originate this moment have a pre-existing culture as well as legacy technology and processes that can be more or less amenable to DevOps implementation. That organizational culture is influenced by the personalities and management styles of Executive Management, the wider culture in which the organization is situated, and the personalities of key team members at all levels of the organization. This culture and entrenched interests usually throw a wrench in the work...
DevOps is under attack because developers don’t want to mess with infrastructure. They will happily own their code into production, but want to use platforms instead of raw automation. That’s changing the landscape that we understand as DevOps with both architecture concepts (CloudNative) and process redefinition (SRE). Rob Hirschfeld’s recent work in Kubernetes operations has led to the conclusion that containers and related platforms have changed the way we should be thinking about DevOps and...
The question before companies today is not whether to become intelligent, it’s a question of how and how fast. The key is to adopt and deploy an intelligent application strategy while simultaneously preparing to scale that intelligence. In her session at 21st Cloud Expo, Sangeeta Chakraborty, Chief Customer Officer at Ayasdi, will provide a tactical framework to become a truly intelligent enterprise, including how to identify the right applications for AI, how to build a Center of Excellence to ...
Consumers increasingly expect their electronic "things" to be connected to smart phones, tablets and the Internet. When that thing happens to be a medical device, the risks and benefits of connectivity must be carefully weighed. Once the decision is made that connecting the device is beneficial, medical device manufacturers must design their products to maintain patient safety and prevent compromised personal health information in the face of cybersecurity threats. In his session at @ThingsExpo...
SYS-CON Events announced today that Massive Networks will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Massive Networks mission is simple. To help your business operate seamlessly with fast, reliable, and secure internet and network solutions. Improve your customer's experience with outstanding connections to your cloud.
From 2013, NTT Communications has been providing cPaaS service, SkyWay. Its customer’s expectations for leveraging WebRTC technology are not only typical real-time communication use cases such as Web conference, remote education, but also IoT use cases such as remote camera monitoring, smart-glass, and robotic. Because of this, NTT Communications has numerous IoT business use-cases that its customers are developing on top of PaaS. WebRTC will lead IoT businesses to be more innovative and address...
Everything run by electricity will eventually be connected to the Internet. Get ahead of the Internet of Things revolution and join Akvelon expert and IoT industry leader, Sergey Grebnov, in his session at @ThingsExpo, for an educational dive into the world of managing your home, workplace and all the devices they contain with the power of machine-based AI and intelligent Bot services for a completely streamlined experience.
Because IoT devices are deployed in mission-critical environments more than ever before, it’s increasingly imperative they be truly smart. IoT sensors simply stockpiling data isn’t useful. IoT must be artificially and naturally intelligent in order to provide more value In his session at @ThingsExpo, John Crupi, Vice President and Engineering System Architect at Greenwave Systems, will discuss how IoT artificial intelligence (AI) can be carried out via edge analytics and machine learning techn...
FinTechs use the cloud to operate at the speed and scale of digital financial activity, but are often hindered by the complexity of managing security and compliance in the cloud. In his session at 20th Cloud Expo, Sesh Murthy, co-founder and CTO of Cloud Raxak, showed how proactive and automated cloud security enables FinTechs to leverage the cloud to achieve their business goals. Through business-driven cloud security, FinTechs can speed time-to-market, diminish risk and costs, maintain continu...
SYS-CON Events announced today that GrapeUp, the leading provider of rapid product development at the speed of business, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Grape Up is a software company, specialized in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market acr...
Existing Big Data solutions are mainly focused on the discovery and analysis of data. The solutions are scalable and highly available but tedious when swapping in and swapping out occurs in disarray and thrashing takes place. The resolution for thrashing through machine learning algorithms and support nomenclature is through simple techniques. Organizations that have been collecting large customer data are increasingly seeing the need to use the data for swapping in and out and thrashing occurs ...