{"id":91092,"date":"2017-08-10T14:30:31","date_gmt":"2017-08-10T20:30:31","guid":{"rendered":"https:\/\/www.biggerpockets.com\/renewsblog\/?p=91092"},"modified":"2024-02-24T12:51:08","modified_gmt":"2024-02-24T19:51:08","slug":"is-the-success-sequence-still-relevant","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/is-the-success-sequence-still-relevant","title":{"rendered":"Is the “Graduate, Find a Job, Get Married, Have Kids” Sequence Still Relevant for Millennials?"},"content":{"rendered":"

In the 1950s, folks had a way of doing things, gosh darn it! Not like these reprobate young people today, these so-called \u201cMillennials!\u201d<\/p>\n

Now that we\u2019ve gotten the mandatory curmudgeon-ness out of the way, let\u2019s get serious about this \u201csuccess sequence.\u201d It was a formula easy enough for even that poor kid wearing the dunce cap in the corner to understand. Coined by the Brookings Institute, the “success sequence” goes like this this: You get at least a high school diploma, you get a full-time job, you get married, and then you have children.<\/p>\n

In that order, too\u2014or else you do not pass Go and do not collect $200.<\/p>\n

Is the success sequence still relevant today, or has American society moved past such notions? Does it still correlate with class, income, and wealth?<\/p>\n

The Study<\/h2>\n

A recent study by the Institute of Family Studies<\/a> found some pretty compelling evidence that the success sequence remains extremely relevant today. It\u2019s worth acknowledging that their mission is to bolster marriage and family, so they certainly have a horse in this race.<\/p>\n

Now that we\u2019ve acknowledged the \u201cwho,\u201d let\u2019s talk data, shall we?<\/p>\n

The study looked at Bureau of Labor Statistics data on Millennials aged 28-34, from all socioeconomic levels.<\/p>\n

Of the Millennials who had completed all four steps in order, 97% were not in poverty. Of those who were \u201con track,\u201d having graduated at least high school and gotten a full-time job but who remain unmarried with no children, a solid 92% were not in poverty.
\n
\nRelated:<\/strong> Why America Has Ditched Homeownership to Become a Renter Nation<\/a><\/em><\/p>\n

Contrast those numbers with the other end of the spectrum, those who did not follow the success sequence at all. A troubling 53% of them were<\/em> living in poverty.<\/p>\n

\"kids-money-lessons\"<\/p>\n

Having Children Before Marriage<\/h2>\n

Perhaps surprisingly, they found that over half\u201455%\u2014of Millennial parents had their first child before getting married. For context, only 25% of Baby Boomers had children out of wedlock at that age.<\/p>\n

Of the Millennials who married first, 95% are living above the poverty line. In an income distribution divided by thirds, 86% of them are in the middle and higher-income thirds.<\/p>\n

Of the millennials who had their first child before getting married, 72% are living above the poverty line. Nearly half of them are in the bottom third of the income distribution.<\/p>\n

Even among Millennials who themselves grew up in poverty, getting married before having children was correlated with far better results. An impressive 71% of those who married before children had reached the middle- or higher-income brackets. Compare that to only 41% among those who had children before marrying.<\/p>\n

Homeownership & Marriage<\/h2>\n

While we\u2019re getting all Leave-It-to-Beaver here, let\u2019s talk about marriage and homeownership rates.<\/p>\n

Did you know that marriages rates have declined among less-educated Americans, but remained largely constant for the better-educated? In fact, some analysts make the case<\/a> that declining marriage rates at the lower end of the socioeconomic spectrum is a major contributor to growing income inequality.<\/p>\n

The homeownership rate among married people is much, much higher than it is for unmarried people. How much higher? Try a homeownership rate of 78.2%<\/a>, compared to the unmarried homeownership rate of 43.4%.<\/p>\n

Sure, two incomes make it easier to qualify for a mortgage than one. But the number of unmarried cohabiters in the United States rose to 18 million<\/a> last year, up 29% over the last 10 years. Roughly half of those cohabiters are millennials under 35.<\/p>\n

Millennials make up the largest homebuyer cohort, comprising 40% of all homebuyers. In fact, Millennials prove quite enthusiastic about homeownership and real estate investing generally<\/a>: Over half of young adults interested in home-buying were also interested in buying investment properties.<\/p>\n

Why do homeownership rates matter?<\/p>\n

Aside from the fact that this is a real estate blog, the average net worth of homeowners ($194,500) was 36 times higher than renters’ $5,400, according to the last Survey of Consumer Finances<\/a> from the Federal Reserve. Lawrence Yun, chief economist for the National Association of Realtors, estimates that today’s net worth among homeowners is 45 times higher than the average net worth of renters<\/a>.<\/p>\n

Homeownership also correlates heavily with income. By one Zillow analysis a couple years back<\/a>, the homeownership rate in the bottom income quintile was only 30%, compared to 87% in the highest quintile.<\/p>\n

\"top-tenants\"<\/p>\n

Paths to Success<\/h2>\n

I\u2019m not here to proselytize or preach family values. To me, it\u2019s not a question of morality. It\u2019s a question of economics and sociology\u2014the \u201csuccess sequence\u201d is part of a broader social construct designed to ensure financial stability and growth.<\/p>\n

Frame the issues however you want, but these facts are incredibly basic:<\/p>\n