When it comes to money matters such as wealth and debt, it's always interesting to see how we're tracking compared to our peers. Recently, KPMG has crunched ABS data for 2023-24 to reveal average wealth per household across each generation.
It's worth highlighting that the figures below are per household rather than per person. So, they may look a bit higher than expected.
In addition, we're looking at averages, not median figures. This matters because averages can be skewed upwards by a few high-value outliers. This also plays a role in the results coming in higher than you may anticipate.
With this in mind, let's take a look at how each generation is faring for household wealth across a range of asset classes.
Baby Boomers (people born between 1946 and 1964) often cop flak for the wealth they've accumulated through property, so it may come as a surprise to learn that Gen X (1965-1980) tops the leaderboard for housing wealth - though only by a small margin.
Gen X holds an average of $1.31 million per household in property wealth, while Boomers hold $1.3 million.
It's no secret that younger generations can struggle to get into the housing market. Reflecting this, Millennials (1981-1996) and Gen Z (1997-2012) have a lot less in property wealth, averaging $750,000 and $69,000 per household respectively.
The shift in property wealth from Boomers to Gen X reflects the housing decisions plenty of 60- and 70-somethings are making ahead of retirement. Many don't want to be lumbered with large homes that suck up time and money in ongoing maintenance and so are downsizing to more manageable properties.
Another surprise: Gen X also trumps Boomers for share market investments, holding an average of $256,000 in shares per household compared to $206,000 among Boomers.
Again, Millennials and Gen Z have considerably lower shareholdings, valued at about $51,000 and $7,000 respectively.
When it comes to 'other assets', which KPMG says consists mostly of superannuation and business assets, Boomers also rule the roost. They have around $641,000, ahead of Gen X with an average of $586,000.
Millennials and Gen Z hold $260,000 and $43,000 in super, reflecting less time in the workforce. This will change over time as these generations reap the rewards of career-long employer-paid super.
It seems that as they age, Boomers are switching from shares to the relative safety of cash because, in this asset class, Boomers lead the field with an average of $242,000 in deposits. That's followed by Gen X with $176,000 per household.
Millennials and Generation Z households hold cash, on average, worth $104,000 and $26,000 respectively.
The numbers we've looked at so far don't consider one major factor: household debt.
As you'd expect (and hope), Boomers have lower levels of household debt (averaging $82,000) than Gen X and Millennials. These two generations each owe more than $400,000 - chiefly in home loans.
Gen Z has the lowest debt at $49,000, mostly HECS and credit card debt.
Net wealth: Boomers trump the other generations
If we look at both sides of the ledger - assets less debt - to arrive at 'net' wealth, Boomers are out in front by a solid margin with $2.31 million per household. That's well ahead of Gen X with $1.88 million. Millennials and Gen Z lag with an average net worth of $757,000 and $96,000 respectively.
The key takeouts
It's always interesting to see how our wealth is tracking compared to others. The important thing to bear in mind is that averages never show the full picture. And they are certainly unlikely to reflect your personal circumstances.
A Gen X single parent, for example, is likely to face more hurdles growing wealth than someone who is part of a two-income, no-kids household.
A recent divorcee aged in their 50s or 60s may need time to get back on their feet financially.
That's why the main game is to follow your own roadmap for wealth creation.
It also helps to follow the basics: Set clear goals for your money, spend less than you earn, and save and invest the difference. Sounds simple, but it isn't easy to do all the time.
The good news is that the figures we've looked at prove that with patience and commitment, we all can grow wealthy over time.
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