Gen Z Has Checked Out of the American Dream; And the Housing Market Is Paying the Price
For generations, homeownership was the ultimate symbol of success. Work hard, save diligently, buy a house. But for Gen Z, that promise feels increasingly hollow. A growing body of research shows that younger Americans aren’t just struggling to buy homes; they’re mentally, financially, and emotionally giving up on the idea altogether. And that resignation is reshaping how they spend, work, and invest.
The Age of First-Time Homebuyers Has Hit a Breaking Point
The housing market’s affordability crisis is no longer theoretical. The average age of a first-time homebuyer has climbed to 40, a stark signal that younger generations are being locked out. Sky-high home prices, elevated mortgage rates, and stagnant wage growth have combined to make saving for a home feel futile for many Gen Z renters.
According to researchers from Northwestern University and the University of Chicago, the market has crossed a psychological threshold: when homeownership no longer feels achievable “within the foreseeable future,” behavior fundamentally changes.
Gen Z Is Spending More Because Saving Feels Pointless
Traditionally, renters tighten their budgets to stay on track for long-term goals like buying a house. But the new research suggests Gen Z is doing the opposite. When saving no longer appears to bring homeownership any closer, young renters redirect money toward consumption instead.
This helps explain the rise of so-called “doomspending.” Nearly half of Gen Z reportedly lacks an emergency fund, and more than a quarter carry more debt than savings. Faced with an unaffordable future, spending today can feel like the only rational choice.
‘No Matter How Hard I Work, I’ll Never Own a Home’
A 2024 Harris Poll captures the depth of the frustration: 46% of Gen Z respondents agreed with the statement, “No matter how hard I work, I will never be able to afford a home I really love.” That sense of futility is central to the researchers’ conclusion that younger generations are “giving up.”
Once people cross that mental line, their financial decisions stop being guided by long-term planning and start reflecting short-term coping.
Financial Nihilism Is Replacing the American Dream
Gen Z economist, Kyla Scanlon describes this mindset as “financial nihilism.” Gen Z has grown up watching the cost of education soar, housing slip out of reach, and wealth concentrate at the top; while living through three major economic downturns before mid-adulthood.
In that context, traditional milestones like homeownership don’t just feel delayed; they feel obsolete. The American Dream, for many, appears broken beyond repair.
Gen Z Isn’t Lazy; They’re Disillusioned at Work
One of the most controversial findings in the research is that discouraged renters report putting less effort into work. The share of renters who say they exert low work effort is nearly twice that of homeowners.
The reason isn’t apathy, the researchers argue; it’s incentives. When hard work no longer translates into progress toward major life goals, the perceived return on effort collapses. As the payoff disappears, so does the motivation.
Why ‘Working Less’ Doesn’t Mean Caring Less
Scanlon offers a reframing: Gen Z isn’t rejecting work itself, but the traditional model of grinding endlessly with little reward. Rather than disengagement, this may reflect a generational pushback against systems that no longer deliver upward mobility.
In other words, Gen Z may still value effort; but only if it leads somewhere meaningful.
Risky Investments Fill the Void Left by Homeownership
When saving for a house feels pointless, risk tolerance rises. The study finds Gen Z renters who’ve effectively given up on homeownership are more willing to pursue risky investments like cryptocurrency; and to spend more on leisure.
The logic is stark: if there’s nothing major to lose, why not take bigger bets? That helps explain why Gen Z is now more likely to own crypto than a retirement account.
A Generation Adapting to a System It No Longer Trusts
Financial experts warn that over-indexing on risky assets can be dangerous. Not maintaining an emergency fund is unwise. But they also acknowledge the reality Gen Z faces. When traditional paths to stability are blocked, alternative strategies; even volatile ones, become more appealing.
Gen Z’s behavior isn’t irrational. It’s a response to a housing market and economic system that has made long-term planning feel like a losing game. And until affordability returns, “giving up” may remain the most rational choice of all.
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Social Security Crisis: New Plan Could Tax High Earners to Prevent 21% Benefit Cut
The United States is facing a fiscal double-whammy: a ballooning federal budget deficit and a Social Security trust fund racing toward depletion. With the Congressional Budget Office (CBO) releasing new numbers on potential fixes, one option is gaining significant attention: uncapping the Social Security payroll tax.
Social Security Crisis: New Plan Could Tax High Earners to Prevent 21% Benefit Cut
Car Loan Delinquencies Hit 15-Year High as Student-Loan Payments Return
More Americans are falling behind on their car loans than at any point in the last 15 years, a troubling milestone that underscores how fragile household finances have become in 2025. Economists say the long-delayed return of student-loan payments is a key; and often overlooked driver behind the surge in auto delinquencies now rippling through the economy.
Car Loan Delinquencies Hit 15-Year High as Student-Loan Payments Return
New Social Security CBO Proposal Would Cut Benefits for Top 50% of Retirees
The Congressional Budget Office (CBO) has released a controversial new budget option that aims to shore up the federal government’s finances by targeting the retirement checks of high-income Americans. With the federal deficit hitting a staggering $1.8 trillion in Fiscal Year 2025 and the Social Security insolvency clock ticking down to 2033, this proposal offers a stark look at one potential “fix”: changing the math to pay the wealthy less.
New Social Security CBO Proposal Would Cut Benefits for Top 50% of Retirees
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John Dealbreuin came from a third world country to the US with only $1,000 not knowing anyone; guided by an immigrant dream. In 12 years, he achieved his retirement number.
He started Financial Freedom Countdown to help everyone think differently about their financial challenges and live their best lives. John resides in the San Francisco Bay Area enjoying nature trails and weight training.
Here are his recommended tools
Personal Capital: This is a free tool John uses to track his net worth on a regular basis and as a retirement planner. It also alerts him wrt hidden fees and has a budget tracker included.
Platforms like Yieldstreet provide investment options in art, legal, real estate, structured notes, venture capital, etc. They also have fixed-income portfolios spread across multiple asset classes with a single investment with low minimums of $10,000.
