In recent years, a stark economic divide has emerged across American generations, with baby boomers amassing unprecedented wealth while younger cohorts like Generation X, millennials, and Generation Z struggle to keep pace. According to a recent analysis, Americans over 75 have seen their household wealth surge, driven by soaring home values and robust stock portfolios, even as economic pressures squeeze the finances of those under 55. This disparity isn’t just a snapshot; it’s the culmination of decades of policy and market dynamics that have favored older demographics.

The roots of this gap trace back to the housing market boom. Boomers, many of whom bought homes at lower prices decades ago, have benefited from skyrocketing property values, turning real estate into a wealth engine. In contrast, younger generations face prohibitive housing costs, with affordability hitting record lows amid high interest rates and limited supply.

Rising Homeownership Barriers for the Young

Data from Business Insider highlights how the homeownership rate among boomers stands at historic highs, while it plummets for millennials and Gen Z, many of whom are locked into renting due to student debt and stagnant wages. This isn’t merely anecdotal; federal reserve figures show that boomers hold a disproportionate share of mortgage debt at favorable low rates, allowing them to leverage equity without the burden of today’s 7%+ mortgage environment.

Beyond housing, stock market participation exacerbates the divide. Boomers own a significant portion of equities, reaping gains from a bull market that has lifted indices like the S&P 500 by over 20% in the past year alone. Younger workers, often starting careers amid recessions or pandemics, have less disposable income to invest, missing out on compound growth.

Stock Ownership and Wealth Concentration

As noted in a Business Insider report from 2020, boomers control 53% of U.S. wealth despite comprising a smaller workforce segment, a trend that has only intensified. This concentration means that market rallies disproportionately benefit older investors, while Gen Z and millennials, facing gig economy instability, prioritize survival over long-term savings.

Mortgage debt dynamics further widen the chasm. Many boomers refinanced at rock-bottom rates during the early 2020s, locking in low payments and freeing up cash for investments. Younger buyers, however, grapple with higher borrowing costs, often delaying home purchases or accumulating high-interest consumer debt instead.

The Debt Trap for Emerging Generations

Insights from NPR underscore how economic policies have enriched boomers at the expense of the young, with professor Scott Galloway arguing that intergenerational transfers are skewed. This “robbing” effect is evident in stagnant wages for entry-level jobs, where Gen Z earns less in real terms than boomers did at the same age.

Looking ahead, this wealth imbalance could reshape societal structures. Boomers approaching retirement may sell assets, potentially flooding markets and depressing values for younger buyers. Yet, without policy interventions like affordable housing initiatives or tax reforms, the gap may persist.

Policy Implications and Future Shifts

A People report citing Bank of America suggests Gen Z could eventually surpass boomers in wealth by 2035, driven by tech-savvy earning potential and inheritances. However, current trends indicate a rocky path, with millennials already mirroring boomer suburban lifestyles but with far less financial security, as explored in another Business Insider piece.

Industry experts warn that without addressing these inequities, economic mobility could stall, affecting productivity and innovation. For now, the boomer advantage persists, a reminder of how timing in economic cycles can dictate generational fortunes.