As people get older, they tend to become more at peace with their finances, survey research shows. But not the current crop of middle-aged Americans.
Let’s call them the Grumpy Middle.
They are unhappier than previous generations. And they’ve been this way for years.
Typically, people 45 to 54 are more likely than others to say they are “pretty well satisfied” with their financial situation, according to the University of Chicago’s General Social Survey. Then the generation born between 1962 and 1971 started to reach their current age range — and bring their longstanding economic dissatisfaction with them.
By 2016, as middle-aged Americans, they were 12 percent less likely to say they were satisfied financially, and 18 percent more likely to say they were unhappy. (Respondents can also give a neutral answer.)
Following the Grumpy Middle over time in the survey reveals that they have been less happy than other respondents as far back as the early 1990s, when most of them were in their 20s.
Americans in their 20s and 30s have always expressed a higher degree of anxiety, but this is the first time in the survey that the dissatisfaction has crept so far up into middle age. The General Social Survey does not dig deeper on this and ask why. And other variables that touch on personal happiness don’t suggest people born between these years are more unhappy overall.
But when it comes to money, a look at economic data begins to yield some clues.
Middle age used to be the peak earning years on the job market, but this is no longer true, especially for men. People 45 to 54 are still earning more than younger colleagues. What’s changed is on the other side of the age matrix: Older workers have increasingly gained ground on the income scale. The older they are, in fact, the more rapid the ascent up the income rankings.
Back in 1994, when the baby boom generation was filling in the 45-54 age group, a male full-time worker made $1.29 for every dollar made by other male full-time workers. Women in this age group were also the top earners, although female pay was not as disparate; they made $1.13 for every dollar made by other female colleagues.
Today, women still face a big pay gap with men, but among female workers there’s still less age disparity. For both genders, however, older workers — especially the rapidly growing pool of boomers over age 65 — are holding a growing share of the high-paying jobs.
The Grumpy Middle got to college around the time the drinking age was raised to 21 and were too young to enjoy all of the benefits of the booming 1980s economy, but old enough to have worked with older colleagues who could regale them with tales of how great things were for white-collar workers in the 1980s.
And now they’ve reached their peak earning years, only to find they are no longer peak earning years.
Put another way: America is getting older. But American wealth is aging even faster.
Historically, older Americans ranked near the bottom of the income and wealth scales, but by 2013, they were moving up the income ladder and comprising a greater share of wealth. That trend has accelerated.
As recently as 2010, Americans 65 and older comprised about a fifth of the population but a third of the wealthy population (those ranking above the 95th percentile).
This makes sense, given that older people have more time to accumulate savings, benefit from investments, and gain equity in real estate they may have bought decades earlier.
And older Americans have grown wealthier since, with a net gain of 750,000 spots in the top 5 percent. The number of 5 percenters below age 55 dropped by about 440,000.
Today’s older generation lived and worked through one of the greatest economic times in modern history. If they invested along the lines of the broader market, they reaped huge rewards. If they bought a house, it probably appreciated significantly. If they worked for a corporation, they are likely to have a generous retirement plan.
But they are also increasingly likely to work. And while for some this means working part-time in retail to supplement retirement income, the overall trend skews higher.
Older people are staying in full-time, high-paying jobs a lot longer than in the past. About 1 in 7 Americans over 65 worked full time last year, compared with 1 in 12 in 2000.
The occupation growth mirrors what we know about the rest of the economy. Compared with 15 years ago, older workers are much more likely to work as doctors, financial specialists and computer programmers.
They are less likely to work in sales, or on an assembly line.
So although older Americans have always been far more likely to be satisfied with their finances, they’re also riding a wave of increasing dominance on the income scale and hanging onto high-paying work, keeping some of those slightly younger 45-to-54-year-olds from ascending to those jobs. Maybe that’s part of why that younger group is grumpy.