Why Young Generations Can't Afford The American Dream | Freddie Smith

Baby Boomers, born between 1946 and 1964, grew up in an era of unprecedented economic growth, job security, and affordable living standards. By contrast, Millennials and Gen Z face challenges that previous generations largely avoided. In this discussion Freddie Smith highlights how these generational shifts have impacted key aspects of life, from homeownership to retirement planning.

The Affordable Housing Crisis
One of the most significant advantages Boomers had was access to affordable housing. In the 1960s and 1970s, housing prices were significantly lower relative to income. Freddie explains that many Boomers were able to purchase homes in their 20s or 30s with relative ease, as wages kept pace with the cost of living. Today, however, Millennials and Gen Z face an affordable housing crisis, where the price of homes has skyrocketed far beyond what the average salary can accommodate. This makes homeownership, a cornerstone of the American Dream, far more elusive for younger generations. Rising rents and stagnant wages have also made saving for a down payment nearly impossible for many.

Job Market and Economic Stability
Another major difference Freddie discusses is job security. Boomers grew up during a time when the job market was relatively stable, and it was common for people to work for one employer for most of their career. Defined benefit pension plans and strong labor unions further secured their financial futures. In contrast, Millennials and Gen Z have entered a volatile job market where temporary and gig work has become the norm. With fewer companies offering pensions, younger generations are forced to navigate the complexities of saving for retirement as wages are not keeping up with inflation.

The Retirement Crisis
Boomers are retiring with substantial savings, thanks to the robust economic conditions of their prime working years and employer-backed pension plans. By contrast, Millennials and Gen Z face a looming retirement crisis. With stagnant wages, soaring living costs, and limited access to pensions, younger generations are struggling to save adequately for retirement. Freddie points out that many Millennials and Gen Z workers are also burdened by student debt, making it even harder to save for their future.

Freddie Smith’s insightful analysis in this video helps explain why Boomers had it way better than Millennials, Gen Z, and Gen X. From the affordable housing crisis to the retirement crisis, today’s younger generations are navigating a more challenging economic landscape, marked by rising costs, unstable employment, and fewer safety nets. Understanding these generational differences is key to addressing the systemic issues that continue to widen the gap between Boomers and younger generations.

0:00 Intro
0:33 Why Americans Can't Afford The American Dream
2:04 Why Homes Are No Longer Affordable
4:18 Is Private Equity Actually Buying All The Available Homes?
5:55 Why Politicians Don't Actually Care About Creating More Homes
9:28 Why Lowering Interest Rates WONT Fix Americas Housing Crises
12:29 Where Real Estate Prices Will Be In The Next 5-10 Years
14:33 Why Boomers Are So Divided Against Younger Generations
17:46 Can The United States Pay Off The National Debt?
21:08 How Increased Medical Expenses Is Severely Hurting Boomers Retirements
24:44 Can Americans Ever Come Together?
34:45 Will Millennials And Gen Z Ever Retire?
37:18 Why Freddie Began This Social Media Journey

#financialeducation #financialfreedom #economy

Titles for the Algo!
The Price Millennials & Gen Z Pay for Boomer Greed
Why Millennials & Gen Z Can’t Ever Get Ahead
How Young Generations Are Now Poorer Than Their Parents
How Young Generations Are Now Poorer Than Boomers
Why Boomers Had It WAY Easier Than Younger Generations

[racheldebner]

As gen z, thank you for telling me I am not crazy. I really needed to hear that.

[whatchis]

I'm a younger millennial ('93) so I feel the pain of missing out on the cheap rate since covid decimated me but also lived well beforehand on less than 70k for several years prior. I have finally recovered enough and pinched and saved along with making enough to finally be at a point of talking with a mortgage broker and beginning the process. I literally am working every day of the week to make it happen, and I won't be paycheck to paycheck just to buy a $400k starter new build which is ridiculous. My young boomer mom will also have to live with me for the rest of her life since she never got to save any money nor had the great job that offered a pension. I'm sure this will continue to be a more common theme as time goes on and the unveiling of the genx financial mishaps. It's just crazy to know that interest rates dictate how well we can live or not.

[zfloe]

Yup! And craziest part is some of the boomers still figured out how to fuck up such a straightforward life.

[AlexhPDX]

Single family homes shouldn’t be the investment vessel they’ve become. Put your money in the stock market if you want to invest, we just want a place to live and not rent forever.

[nickmattio]

Going off the gold standard in 1971 is a HUGE reason for where asset prices and debts are today period.

[murdockhancock]

Imagine, if you will, that as a young man, your grandfather bought a new car and he swears it was the best car that he has ever owned, and he drives it for several years and then gives it to his son. Of course it's a hand-me-down; it's kind of roughed up, but more or less gets him from point A to point B, and then the father puts it in a field somewhere and leaves it there, and later you come across it, and of course it's been in the field for a decade plus, and it looks like it, so you tell your grandfather that it's run down and doesn't work, and the grandfather simply tells you, "What nonsense, it started up every time, and it's the most reliable car I have ever owned, " so you struggle to get it across to him that the car that he knew and that he experienced in his life is not the same car that's sitting in front of you. What would you tell the old man to get it across to the grandfather that the car that he knows and "experienced" is not the same car that's in front of you?

[SurpriseMeJT]

Your home should not be such a speculative investment and corporations shouldn't be competing with regular people. This is why I like living in France. The problem is that the US needs maximum speed growth in order to stay being the US, so I really doubt anything will change with the housing price situtation. It's a bad system but nothing seems to be stopping it since our corporate funded broken political system doesn't allow us the ability to change anything. I saved my money and left the US probably for good.

[edwardzignot]

10 years ago I was able to have my own apartment and do fun stuff once in awhile off 42k a year. Now, my rent is 400 more a month and if I didn't have a kinda unique situation as a live in property caretaker I don't think I'd even have housing. Still making about the same, but everything's like 50% more expensive. If this continues you're gonna have massive poverty and homelessness issues. Once normal hardworking people can't house themselves or feed their kids man, I don't know, it's gonna be the apocalypse. That's historically the point when societies crumble and revolutions occur and all that.

[franklsuarez]

I think the American Dream died when the Middle Class disappeared.

[Icedanon]

Isnt it interesting the game of monopoly comes to an end once someone owns all the housing that no one else can afford? What happens next? Well, in monopoly, the pieces go back in the box...

[darrylloo]

The federal government keeps on raising the debt ceiling. Imagine doing that with your budget? No accountability.

[MegaMerlin]

Not really a housing supply problem. More of a turning a necessary item into an investment tool. Imagine what it'd be like if NYC execs turned your casual fruits/veggies at the store into something they can bid/auction like the stock market. Suddenly the price of 1 banana is going to go through the roof!

Edit: There ya go! He said it! "Well, politicians are working on affordable housing, but it's not happening in the neighborhood where MY investment property is because it'll drag down the value." Hence why I said turning homes into investment tools like the stock market was a bad fucking idea. If they want to allow investing in real estate, the government needs to create special zoning laws where only property in the touristy part of town is allowed for investing and renting out as vacation homes/airbnb. I don't have a home and even with the local state first home buyer program I still can't afford a home. My state is a fucking flyover state nobody gives a shit about, yet prices are still up because homes overall have become an investment tool nationally.

Edit 2: Chinese boomers are better. They buy their kids a house and a car because they understand these are things that are necessary for their kids to survive in the real world. Can't get a wife/kids while you're living in your mom's basement and taking a shitty public bus to work every day. So Chinese not only set aside money for their kid's education, but they set aside money for buying an apartment unit and a car for their kid. Sometimes they'll buy it before the kid even graduates high school and the parents will rent it out for income until their kid comes of age.

[Mobius_ll]

Why would we respect the housing equity of older generations? What is the purpose of a house value going up when all the houses around you are the exact same? You sell it for 'profit' and then have to spend the same amount moving. Screw this renting economy "you shall own nothing and be happy" etc etc. One thing is for certain, the government has no interests in protecting the average citizen from investment firms, with or without a shortage. I agree when you say the prospects do not look promising. How much wealth can be siphoned upwards before the average person has enough?

[gauloise]

As a Gen Xer, we were immediately after the Baby Boomers who sucked up all the oxygen in the room . They never mentored us, kept us frozen out of every opportunity from our very youngest years, they never retired so we could never move forward. Plus we didnt want to be part of their gaudy. emotionally barren, messy, logo-driven life. Our numbers were so small and theirs so large, there was nothing to do but not play the game. I feel like Millennials don't have the edge (sorry) to enact real change, but Gen Z gives me hope.

[cellospot]

I dropped out of college in 2007 due to many reasons. 7 years ago, I was making around $35k/yr and could see the possibility of buying a $130k house on 5 acres in N. Idaho. I decided to pay off debt before buying a house. Now I make $40k/yr and am debt-free, but houses now cost nearly a half mill on 5 acres. There's no way. And I regard renting as throwing money away. At this point, I'm looking at living in my SUV and going to a trade school to start a business in a couple years. It seems to me that the best way to make it is not to go work for someone else, but rather to dive into the world of small business ownership. We need to be encouraging the kids not to become cogs, but to take charge of their lives and communities.

[DayrusBPB]

Past: 1 income household able to afford basic needs & get rich

Present: 2 income household living paycheck to paycheck.

[lilyjawad]

If you listen to Congress talk about military budget/how much they're paying for items its the same as healthcare. We are being overcharged for military expenses just like how we are overcharged for medication.

[mikew]

@23:33 "Yea but you're still lazy" isn't supportive. It's a complete lack of understanding that everything is on a subscription model now and they were the last ones to have the opportunity to 'own' something.

[Daveyjonesvi]

The one main thing that can’t be understated is where all the money is going. If it were regular inflation these mega corporations wouldn’t keep recording record profits year after year. If it were regular inflation the money in a sense would disappear from the economy. We are in a very unequal economy and to fix it we need better wealth distribution by taxing the mega rich more and incentivizing better pay for all workers

[easyrebel]

As someone who is a little older, when I was looking for a house before 2007. Houses were over priced at 300k