It is no coincidence that more and more millennials in the United States are still living with their parents…in basements, sheds and the like. Not only do they remain dependent on parental generosity after marriage or children but the wages they earn are insufficient to enable them to buy a house and form a new household. So there is an increasing proportion of  inter-generational households in the US as millennials burdened with sometimes massive student loans are unable to find the jobs that allow them to repay the loans without living with parents.

In New Zealand mainstream media proclaims  there is evidence of a strengthening economy here and that New Zealand has been noted for its ‘rock-star economy’. It is true that New Zealand has enjoyed a period of good economic growth but similar to the world over there has been significant disparities between those enjoying the economic upturn and those who have not. Now the Salvation Army  has just released a report that states…. (courtesy, New Zealand Herald)

“Growing numbers of Kiwis risk becoming homeless in old age because of falling home ownership rates, rising rents and static housing subsidies, the Salvation Army says. Homeless Baby Boomers, a hard-hitting report by the army’s social policy unit, says superannuitants in private rentals will jump almost four-fold from 61,000 in 2013 to 237,000 by 2030, as those owning their own homes drop from 73 per cent of the age group to 63 per cent. It says rents have risen 4 per cent a year over the past five years, while the accommodation supplement has not changed since 2007, making it harder for many elderly renters to survive. “Australian housing researchers are reporting increasing incidents of what they term first-time homelessness amongst people in their later middle age or early retirement years,” it says. “These are people who have held down jobs and led fairly conventional lives until an event such as a relationship breakdown, redundancy, injury or a health setback means that they lose their housing and perhaps their income.

It is highly likely that the baby boomer generation is going to the first generation to face mass poverty in retirement as so many are underfunded for retirement and even if they do have sufficient resources saved the struggle to generate yield in a zero or negative interest rate environment make it difficult to earn enough to live on comfortably.