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Millennials’ average net worth doubled during pandemic, report finds

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Covid-19 bailouts and record low interest rates have boosted the finances of many Americans during the pandemic. This is especially true for millennials, who have made significant fortunes on average.

Millennials born between 1981 and 1996 have more than doubled their total net worth, reaching $ 9.38 trillion in the first quarter of 2022, up from $ 4.55 trillion two years ago. Magnify Money Report..

Millennials’ average net worth (defined as total assets minus total liabilities) also doubled over the same period, jumping from $ 62,758 to $ 127,793, the report said.

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However, according to reports, Millennials’ average net worth still lags behind older generations, with Generation X and Baby Boomers averaging $ 647,619 and $ 1,021,264, respectively.

More than one-third of millennial wealth real estate

Millennials are advised to focus on cash flow rather than net worth at this stage of their career.

DJ hunt

Senior Financial Advisor to Moisand Fitzgerald Tamayo

DJ Hunt, a certified financial planner and senior financial adviser to Mois and Fitzgerald Tamayo in Melbourne, Florida, said:

He said millennials could “lose their financial base in the long run” if monthly mortgage payments prevent them from fully funding their retirement accounts.

Of course, the definition of a wholly-owned retirement account varies from person to person, Hunt said.

Millennials in their early 40s Maximize your 401 (k) donation for $ 20,500 In 2022, he said, young workers need to make enough deposits to receive company matches and strive for up to 15% of their total income.

Diversification is the “name of the game”

Eric Roberge, CFP and CEO of Beyond Your Hammock in Boston, says owning and living a home serves an important purpose, but diversification is the “name of the game”, especially young investments that take a long time to build assets. That’s right for the house.

If most of your wealth is home equity, it may be wise to propose 20% to 25% of your total annual income for long-term investment and focus on building a retirement plan or intermediary account. He said.

“For many people, diversified portfolios are likely to offer higher returns in the long run,” he said.

Applying for a Home Equity Credit Line

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If you are sitting in the wealth of your home, it may be worth it Apply for a Home Equity Credit Line, Or HELOC. If you want, you can borrow from the pool of funds over time.

Ted Haley, President and CEO of Advanced Wealth Management in Portland, Oregon, said:

HELOCs are usually cheaper to set up, have lower interest rates than credit cards, and have no additional cost to use. Higher interest rates may affect the amount and timing of borrowing, but having it is still a “good idea,” he said.

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