For millennials, the idea of becoming a millionaire was planted early on. TV shows like Who Wants to Be a Millionaire glorified the million-dollar reward as a life changing sum of money that was otherwise reserved for celebrities, athletes and CEOs.

Now, as millennials near midlife, their views on becoming a millionaire have shifted from a lofty goal to something more of a necessity. With crippling student loan debt, a housing affordability crisis and sustained inflation, millennials are realizing that, in order to afford a home in a desirable city or retire comfortably, they need to achieve millionaire status sooner than later.

According to a new study released by Arta Finance, 54% of millennials say it’s necessary to be a millionaire or more to thrive in today’s economy, while 50% say they need to be multimillionaires. That’s a high bar for a generation of Americans who largely live paycheck to paycheck, which is the case for 57% of the millennials surveyed.

Millennials face more anxiety than older generations

By comparison, as consumers age and become more established, their need to be a millionaire declines. 44% of Gen Xers surveyed say they need to be a millionaire to survive in today’s economy, with only 27% of those who are Boomers and above saying it was a requirement. This further underlines how current economic conditions impact the way millennials feel about their financial security, compared to the generations that came before them.

Despite growing anxiety about their financial outlook, nearly half of millennials (46%) remain optimistic – still believing they’ll become a millionaire in their lifetime. That’s compared to 27% of Gen X and 13% of Boomers and above who are less optimistic.

Millennial optimism is boosted by strong financial strategies

To achieve this milestone, millennials have deployed a number of strategies to help them manage and improve their finances. Beyond traditional strategies like saving for retirement (38%) and budgeting and tracking expenses (37%), 30% of millennials say they have taken on a side hustle to improve their financial standing. Others are taking their financial futures into their own hands by increasing their investments into the stock market (28%).

While many millennials remain optimistic – believing they’ll become a millionaire in this lifetime – most say it feels impossible in this economy (56%). The factors that millennials feel are impacting their ability to achieve major financial milestones, like becoming a millionaire, include sustained inflation (42%) – which reached 9.1% in 2022, the highest point in the last five years, and now hovers around 3% – as well as the rising cost of living (39%). Others say the cost of having and raising children (20%) has held them back, along with unaffordable housing (19%). Mortgage interest rates hit 7.79% in October 2023 — the highest in 20 years, as reported by CNN — and are only just starting to come back down to earth.

Millennial millionaire: reality or fantasy?  

It’s clear current economic conditions have created financial strain for millennials. While more than half of millennials (54%) say they need to be a millionaire to thrive – live comfortably without having to stress about money – 47% say they need to reach this financial threshold just to be financially stable. This means they think they need to be a millionaire just to pay the bills.

So, how are millennials fairing financially in reality?

According to the study, most millennials are behind on their goal of achieving millionaire status. Nearly two thirds (64%) of millennials reported a net worth below $250,000 with one third saying their net worth is below $50,000. What’s more, 39% of millennials have less than $10,000 in savings, a quarter of those have less than $5,000 tucked away. Meanwhile, 16% of millennials have achieved a net worth above $1 million, putting them on the path to a more secure financial future.

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“Millennials need more money. That’s because the economy has shifted and it’s become more expensive for consumers to make ends meet. As a result, many millennials are feeling behind as the threshold to achieving financial stability continues to climb,” said Samita Malik, consumer wealth advocate and chief insurance officer at Arta Finance. “Whether or not you are on the path to becoming a millionaire, there are a number of steps you can take to increase your net worth. It comes down to three key things: know, grow and protect your wealth. Knowing about your wealth starts with creating a budget and tracking your expenses. Once you know where you stand you can start to assess how much money you have to put towards saving and investing each month. From there you can assess where you want to invest your money based on your financial goals and tolerance for risk. This could include things like earning higher yield on your cash or investing beyond stocks and bonds. Once your money is situated, it’s important to protect it through the proper insurances and, eventually, tax and estate planning.”

Methodology

This survey was conducted online by TEAM LEWIS on behalf of Arta Finance between August 13 and August 23, 2024. Survey respondents were provided by OpinionRoute and Cint and included 2,000 U.S. consumers above the age of 18, weighted to be census representative in age and gender. 

Learn More About Arta

Arta Finance is a digital wealth management platform designed for accredited investors, offering access to leading fund managers in private equity, venture capital, and private credit, along with intelligent investment tools for public markets. Headquartered in the US and Singapore, Arta combines cutting-edge technology with financial expertise to empower its members to grow, protect, and enjoy their wealth.

All investing involves risk, including risk of loss. Past performance is no guarantee of future results. These materials do not constitute an offer to sell or a solicitation of an offer to buy interests in any investment vehicle or product. The views expressed are those of Arta Finance’s senior financial professionals as of a particular point in time and are subject to change without notice.