Between sky-high student loan debt, medical bills, and the rising expenses of day to day living, millennials have had to throw down a lot more cash than the generations that came before us. And, it turns out, that the amount we spend on rent can be added to that pile, too. Wondering exactly how much money millennials spend on rent? Are you sitting down? According to a new report from Rent Cafe, you'll likely spend 45 percent of your income on rent, which means that by the time you turn 30, you will have spent an average of $92,600 on rent. That's $92,600 over the course of just eight years. Seriously. According to Rent Cafe, experts recommend that you should spend no more than 30 percent of your income on rent. However, they also reported that none of the last three generations have been able to make that work.
Gen Xers spent 41 percent of their incomes on rent by the time they turned 30, while baby boomers spent 36 percent. The struggle is very real: The financial burden for millennials is so high that they are often referred to as "generation stressed." With rising housing costs, other needs often go unmet as people are forced to put more money toward rent. "The number one cause of money stress is the feeling that you are one disaster away from financial ruin," Diane Harris, a financial wellness columnist for PBS's digital media platform Next Avenue, told Everyday Health. "Most people do not have enough money saved to cover a $4,000 emergency, and emergencies happen all the time."
Aside from astronomical rent costs, millennials are also saddled with crippling student-loan debt. And debt is also cited as the number one reason that many millennials can't afford to buy homes. It's true that moving to a smaller city can save you money on rent, but it also decreases job opportunities. Additionally, the fact that women still make less money than men only compounds the problem.
"Women overall earn 80 cents for every dollar a man brings home, according to the National Partnership for Women & Families, and it's even worse for women of color: African-American women earn just 63 cents, and Hispanic women earn only 54 cents for every dollar a white, non-Hispanic man makes," Kelley Holland, a financial coach and founder of Own Your Destiny Coaching, told Everyday Health.
LA Weekly reported that older millennials, ages 26-34, are most affected by the rent crisis in that city. "Not only are the percentage of renters increasing, so are the rents — which have risen faster than incomes," Trulia told LA Weekly. "Average rents in the top 50 markets have risen 22.3 percent, while incomes nationally fell 5.8 percent in the nine years since 2006."
In another survey, Apartment List found that 80 percent of millennials are renters. What's more, if you do have your sights setting on owning a home one day, it will take you at least 10 years to save enough money for a 20 percent down payment. If you live in San Francisco, San Diego, Los Angeles, or Austin, it will take you almost 20 years to save the same amount. "A millennial in San Jose, the metro with the longest wait time of almost 24 years, wouldn’t be able to afford a 20 percent down payment on a condo until the year 2041," Apartment List revealed.
Honestly, I don't see how I will ever be able to afford a home, or spend less than 50 percent of my income on rent, unless I win the lottery or move back to Ohio, which isn't that appealing. For generation Z, the news is even worse. Rent Cafe revealed that they will have spent more than $100,000 on rent by the time they turn 30. While millennials are often dismissed as snowflakes and are shamed for spending money on things like avocado toast, those in the trenches know that it's more complicated than that.
"Hello yes it is me, just another millennial blowing their money away on overly expensive rent, necessary auto maintenance, other bills and student loans," @elizabethann162 tweeted. "Unfortunately I can not afford retirement because I decided to buy an avocado today." In a previous Bustle article about millennial finances, Los Angeles based writer and filmmaker Erin Enberg put it this way. "There's no way I'm ever owning a house. It's not something I think about. So let me eat my avocado toast in peace." Ready for the silver lining? Since you'll likely need a roommate forever, that Golden Girls fantasy is totally within reach. #SquadGoals