People just love giving millennials unsolicited financial advice. It follows us from the news headlines to the dinner table with our very own well-meaning older relatives.
Things I often hear include: "You guys have got to stop going out to eat so much. You're never going to save any money." "You should just start preparing your lunch the night before."
As I sit here, eating $12 feta-cheese-covered avocado toast that I ordered on Seamless, I'm reflecting on their advice. I've tried to follow it, really. And it's meant to be helpful, I know. Eating out adds up, and putting a little more time into food prep can pay off.
But the people giving it all have vastly different lifestyles from my fiancé and me. We don't have a car or kids. The advice-givers all had kids in their mid-20s; we are not planning on it for at least a couple of years (think of how much that saves). We rent now, and aren't in a particular rush to buy a house, but we're still saving — despite a few $8 avocado toasts and $10 glasses of wine here and there. It's also not like eating out is emblematic of our generation; I know plenty of people who do cook all the time.
When people give advice like this, it's often because they want to highlight their own accomplishments rather than truly help. That seemed to be the case when 35-year-old Australian millionaire and property mogul Tim Gurner told Australia's 60 Minutes that if millennials just didn't buy all that smashed avocado, they'd be able to save money and be more like him. (Of course, Twitter tore him to shreds.)
"When I was trying to buy my first home, I wasn’t buying smashed avocado for $19 and four coffees at $4 each," Gurner said on the show. "We’re at a point now where the expectations of younger people are very, very high. They want to eat out every day; they want travel to Europe every year." To be fair, $19 is ridiculous, but it's usually not that pricey.
He continued: "The people that own homes today worked very, very hard for it," adding that they "saved every dollar, did everything they could to get up the property investment ladder."
Inexplicably, he also said: "This generation is watching the Kardashians and thinking that's normal — thinking owning a Bentley is normal." Tim, can we not? I don't actually know anyone who thinks it's normal to own a Bentley.
Gurner's advice clearly worked for him. I concede this to him; I consume avocado toast that I did not prepare myself on a weekly, sometimes twice-weekly, basis and I am not a millionaire. (I've also never gotten anywhere near $34,000 from anyone to kickstart my career, so...) But for most millennials, it not only sounds condescending, but doesn't exactly add up, either.
The actual problems are the unpaid internships, stagnant wages, and soaring rents and home prices. When you reduce the issue to a piece of toast, you're missing the point.
First off, millennials are doing just fine with homeownership without his advice. According to 2016's Zillow Group Consumer Housing Trends Report, our generation makes up more than half of all home buyers today and 56% of first-time home buyers. "Old" millennials (those between ages 25 and 34) are planning ahead financially to buy those homes; 40% have started saving for a down payment. On top of that, one-third of millennials are already homeowners, according to a recent report by Bank of America.
Second, if you're going to blame the fact that our generation is generally worse off than our parents on anything, leave the overpriced breakfast out of it. The actual problems are the unpaid internships, stagnant wages, and soaring rents and home prices. When you reduce the issue to a piece of toast, you're missing the point and insulting people who graduated college to the cold shower of the recession.
About our much-maligned eating-out habits: Another Australian, columnist Bernard Salt writing in The Australian Magazine last year, actually made a similar argument about avocado toast (which was similarly smashed to bits on Twitter).
"I have seen young people order smashed avocado with crumbled feta on five-grain toasted bread at $22 a pop and more. I can afford to eat this for lunch because I am middle-aged and have raised my family. But how can young people afford to eat like this?" he wrote. "Shouldn't they be economising by eating at home? How often are they eating out? Twenty-two dollars several times a week could go towards a deposit on a house."
For one thing, baby boomers have no business telling us what to do, given that they're responsible for many of the policies that got us into the mess of the recession. But also, all Americans are spending more on eating out, not just millennials. According to the USDA, how much we spend on "food away from home" has risen to 43.1% of food spending in 2012, from 25.9% in 1970, The New York Times reported.
The Food Institute, which analyzed Bureau of Labor Statistics data from 2015, has found that millennials (people ages 25 to 34) spent $3,097 on average on eating out during that year. This is only $305 more than baby boomers and $89 more than the national average. According to the NYT, "even if millennials assumed the eating-out habits of baby boomers, it would take around 113 years before they could afford a down payment on a home (assuming a 20% down payment on the median price for a home in the United States, $315,000 in March 2017, and a 1% yearly yield rate)."
I did my own math. A serving of avocado toast costs about $8 at the coffee shop near my Brooklyn apartment. If I bought it once every single day of the year, which no one does, it would cost me about $2,920. A once-a-week habit? That would bring it down to $416 a year. $988 if I were indulging in $19 toast with all the works. Not exactly a huge dent in the typical $63,000 down payment. Of course, I'm spending money on more than just avocado toast — but every single time I eat out, it lets me spend more time getting ahead at work, hanging out with people I love, reading books, and planning trips. I'd rather take a few more years to buy a house than miss out on any of that. No wonder they say millennials value experiences.