As more and more millennials find it difficult to afford their own housing, an increasing number of young adults are choosing to live at home with their parents. In fact, according to new data from Pew Research Center, young adults (ages 18-34) in the U.S. live with their parents at the highest rate since the Great Depression. In 2014, 32.1% of millennials lived at home with their parents.
However, this trend is widespread and isn’t confined to the United States. Across the European Union’s 28 member nations, 48.1% (nearly half) of 18- to 34-year-olds were living with their parents in 2014.
As you can see, the economic downturn is accelerating and global. The only question is: How severely can this trend progress? From the same report, the share of 20- to 34-year-olds in Japan living with their parents grew from 29.5% in 1980 to 48.9% in 2012. Unfortunately, there’s a good chance that the U.S. will follow in Japan’s footsteps.
THE LIGHT AT THE END OF THE TUNNEL
One encouraging thing about this data is millennials’ financial instincts. Because the rules of money are different today, it will become the norm for young adults to live at home longer as they become financially stable. It’s just that the ones that realize the benefits of staying at home sooner are able to cut costs and save money earlier. In fact, young adults who are not burdened with high housing costs and student loan debt are able to carve out a non-traditional path to financial freedom. Yes, it will require financial education, but the fact that so many recognize the need to find an alternate solution for one of life’s most expensive costs – housing – is a very promising start.