Avocado Toast, Crushing Debt and a Fear of the Stock Market

With the media frenzy around the “OK Boomer” trend, the tension between Boomers (born 1946–1964) and Millenials (1981–1996) has never been higher. With their opposing views on politics, the free market, arts and gender expression, Boomers have whittled down the diversity of the millennial generation to avocado-toast loving, retail killing, free-loading kids. The millennial generation has been praised as being the most highly educated (and most indebted) generation of the 20th century. Despite their higher education, you may be surprised to find that one of the defining factors of their generation is actually their ignorance of a major and historical financial tool.

With a steadily increasing cost of living, and the across-board minimum requirement for higher education, the necessity for multiple streams of revenue is greater than ever. Despite this, millenials as a whole have seemed to ignore the modern-day standard for generating income that Boomers have dominated since the 70s: the stock market.

According to a survey done by Bankrate, 38% of boomers prefer to invest in the stock market; a stark contrast to the mere 23% of millennials doing the same. While this may serve as proof to some of millennial laziness, their fear of the stock market may not necessarily be their fault.

The 2008 recession was the worst financial crisis to impact North America since the Great Depression in the 1930s. Over $2 trillion in losses were incurred internationally, and for millenials, this was their first experience with financial catastrophe. Many were just beginning to join the workforce and saw their entry-level jobs disappear as many industry-dominating business evaporated. Others saw the economic ruin create destroy their families financially and were raised to fear the stock market and investing on a whole.

Millenials are also in a staggering amount of debt. According to a 2019 study by the U.S. Department of Education, the average American millennial has $33,0000 in student debt alone. Though millenials on average make more than their boomer counterparts, the generational debt-to-income ratio is drastically better for boomers. With the cost of rent, food, transportation and interest on debt looming over these job seekers, the stock market is not only the furthest thing from their minds, but largely unaffordable.

For Generation Z (born 1997-present), however, the stakes are even higher. An inability for Generation Z to invest cash could lead to a detrimental financial crisis. Generation Z is faced with the greatest post-secondary education minimum of modern-day. An undergraduate degree is now the bare minimum for entry into the workplace and the cost of higher education is only going to increase. Generation Z will have to deal with an even greater amount of student debt, at astronomical interest rates, and investing in the stock market may be the only way we can combat it.

As tensions rise in the political economy, our financial futures as individuals, and as a nation are unclear at best. Though the stock market may seem intimidating at first, it is imperative that Generation Z and millenials alike utilize this 200-year old opportunity to put ourselves in a better place, financially. The stock market is not just for boomers, and changing our negative, emotional connotation with the stock market brings us one step closer to economic success.

Written by Kathleena Henricus, Writer for the Junior Economist