Armstrong Economics Blog/North America Re-Posted May 31, 2022 by Martin Armstrong
A large portion of the youth can no longer afford to live on their own. A new survey found that around 40% of parents in the US currently have an adult child still living at home. An additional 25% reported that their adult child temporarily lived with them but has since moved out. Of the 2,200 respondents, 33% said that their adult children simply could not afford housing on their own. An additional 33% said their child needed financial support after college, while 17% cited job losses.
This has darkened what should be the “golden years” for many Boomer parents. Around 35% said they could no longer afford their long-term goals, and 26% said supporting their adult children has hurt their short-term financial goals. An additional 14% said the added cost had limited their ability to save for future health care.
Previous generations could afford to go to school, work hard, buy a home, and start a family. That is no longer the case amid inflation at a 40-year high coupled with historically high housing and rental costs. The average federal student debt is $36,510 per borrower, while private student debt averages $54,921. Home buying is out of reach for many, as the current average price for a home in America is nearly half a million dollars. Even those with the best credit, and help from their parents, have been outbid by cash offers. Rental costs are through the roof, with the average one-bedroom going for $1,683 (22.1% YoY increase), but it is hard to find an available apartment as occupancy hit 97.5% in December 2021. This all ties in with the drastically declining birthrate as people cannot afford to support themselves, let alone a family.
The unfortunate state of the economy will lead to a new generation of frustrated individuals who are behind in life at no fault of their own. The government has killed the economy, and with it, the American dream.