The Generation That Did Everything Right — And Still Cannot Afford Adulthood

There was once an unwritten contract between society and young adults.

It was never universally true.

It certainly excluded many people.

It varied enormously between countries and social classes.

But in broad terms, the promise looked something like this:

Study.

Get qualified.

Find work.

Become independent.

Buy or rent a reasonable home.

Build a family if you want one.

Save.

Eventually retire.

It was not promised that you would become rich.

The promise was more modest.

If you behaved responsibly, adulthood would be economically attainable.

For millions of younger people, that contract now feels strangely negotiable.

Education succeeded almost too well

Young generations did what advanced economies told them to do.

They studied longer.

They entered university in unprecedented numbers.

They delayed earning to accumulate qualifications.

They became digitally literate.

They learned languages.

They became internationally mobile.

Their résumés often look significantly more impressive at 28 than their grandparents’ did.

Then many discovered a fascinating feature of modern economics:

you can be overqualified to afford a one-bedroom apartment.

This is not quite the return on education brochure they remember.

The problem is not avocado toast

Intergenerational arguments have become one of the great comic genres of modern economics.

Young people accuse older generations of capturing the housing market.

Older people accuse the young of spending money irresponsibly.

Coffee plays a surprisingly prominent role.

Apparently an entire global housing-affordability crisis may have been caused by cappuccino.

The data suggest a slightly larger problem.

EU house prices rose 53% between 2010 and 2024. (European Commission⁠)

In 2024, young Europeans aged 15-29 were more likely than the overall population to experience severe housing-cost burdens: 9.7% versus 8.2% lived in households spending at least 40% of disposable income on housing. (European Commission⁠)

The effect differs sharply by country, but the broad point survives.

Housing is not merely expensive.

It is postponing adulthood.

Italy and Spain illustrate the issue beautifully

In 2024, young people left the parental home at an average age of 30.1 in Italy and 30.0 in Spain.

In Finland it was 21.4.

Denmark: 21.7.

Sweden: 21.9. (European Commission⁠)

Culture clearly matters.

Family structures matter.

Labour markets matter.

Housing markets matter.

It would be foolish to assign everything to one cause.

But it would be equally foolish to pretend that economics has nothing to do with a nine-year difference in the path to residential independence.

There is a peculiar tendency to describe Southern European adults living with their parents as a cultural phenomenon and then forget to mention salaries and rents.

Culture is wonderfully useful when we do not want to discuss the spreadsheet.

Adulthood has become a sequence of increasingly expensive options

Consider the traditional stages.

First independence.

That requires rent.

Then partnership.

Potentially a larger home.

Then a child.

Another bedroom.

Childcare.

Perhaps reduced working hours.

Then another child.

More space.

Education expenses.

Insurance.

Then eldercare arrives precisely when your own children may still need support.

Meanwhile you are expected to fund retirement because public pension systems face demographic pressure.

None of these costs is individually impossible for a good middle-class household.

The problem is their choreography.

They tend to arrive together.

Fertility may be partly a balance-sheet decision

The fertility collapse across wealthy societies is often discussed as if millions of people spontaneously lost interest in children.

Some certainly have.

Values changed.

Women’s opportunities expanded.

Contraception improved.

Marriage changed.

People find meaning outside parenthood.

All true.

But economic security matters too.

The OECD finds that young adults increasingly struggle to establish themselves in housing and labour markets, and its analysis identifies a negative association between housing costs and fertility. (OECD⁠)

In 2024, the EU fertility rate fell to 1.34 children per woman, its lowest level in the available EU series.

Only 3.55 million babies were born in the EU that year, 3.3% fewer than in 2023. (European Commission⁠)

Italy’s mean age at first birth reached 31.9.

Spain’s reached 31.5. (European Commission⁠)

Apparently biology did not receive the memo from the housing market.

Waiting has consequences

When economic milestones move later, life itself does not necessarily adjust.

A home bought at 38 instead of 28 means ten fewer years of mortgage amortization and asset appreciation before retirement.

A first child at 35 rather than 28 changes the feasible timeline for additional children.

Starting retirement savings later changes compound returns.

Living with parents longer can reduce expenses but delay geographical mobility and household formation.

The effects accumulate.

This is why delayed adulthood should not be dismissed as lifestyle choice.

Sometimes delay is choice.

Sometimes it is rationing by price.

We created credential inflation too

There is another uncomfortable question.

If everyone acquires more education, education can remain socially valuable while becoming less differentiating economically.

Jobs that once required secondary education begin requesting university degrees.

Jobs that once required degrees request postgraduate credentials.

Young adults spend more years outside full-time employment preparing to enter jobs that may not deliver proportionately higher financial security.

Education remains enormously important.

But a qualification arms race can impose real costs.

The individual must participate because refusing to participate may damage his prospects.

Collectively, however, society may spend more time credentialing people without producing an equivalent number of high-productivity jobs.

A master’s degree is a fine achievement.

Using it to compete for the salary that once financed a home at 28 is less impressive social engineering.

Then inflation arrived

The post-pandemic inflation shock made the generational equation even harder.

By early 2026, the OECD reported real wages still below Q1 2021 levels in roughly one-third of the countries it analysed, despite strong overall employment. (OECD⁠)

This matters especially for younger workers because they often possess fewer assets.

An older homeowner can experience inflation while simultaneously owning a property that has appreciated substantially over the previous decade.

A younger renter experiences rising prices without necessarily receiving the asset-price hedge.

Inflation therefore does not strike identical balance sheets identically.

Age matters.

Ownership matters.

Debt matters.

This may be the central generational divide: assets versus income

Older generations are often wealthier for an obvious reason: they have had longer to accumulate wealth.

That is normal.

But when asset prices rise much faster than the ability of new households to accumulate deposits, another mechanism develops.

Those already inside the asset market benefit.

Those outside must chase the entry price.

The result is a peculiar society in which the most important predictor of a young person’s economic trajectory may increasingly be not merely salary but whether someone in the previous generation owns enough assets to help.

The supposed meritocracy acquires a family-office department.

The return of inheritance

This could have enormous social consequences.

If housing ownership increasingly requires parental assistance, then wealth becomes more hereditary.

Two equally talented graduates earning identical salaries can experience completely different trajectories.

One receives €100,000 toward a deposit.

The other does not.

One begins accumulating equity.

The other continues paying rent.

Twenty years later, their wealth difference may be enormous despite almost identical professional performance.

That is not simply inequality of income.

It is inequality of starting capital.

And societies built on the promise of mobility should care about it.

Now add artificial intelligence

Young adults are also entering the labour market during the largest technological experiment since the internet.

The ILO’s 2026 review of generative AI finds that large-scale job displacement remains limited so far but warns of uneven effects and potential risks to employment opportunities for younger workers. (International Labour Organization⁠)

This creates another paradox.

We tell young people:

study more because technology is changing.

Then technology changes the jobs they studied for.

The correct response is not to fear AI.

The productivity potential is extraordinary.

But societies must think carefully about who bears transition risk.

A 55-year-old with a mortgage mostly paid off experiences job disruption differently from a 27-year-old with student debt and no assets.

Again, the balance sheet matters.

The social contract is not simply economic

The United Nations’ World Social Report argues that economic insecurity, inequality and declining trust are undermining social cohesion.

More than half the world’s population reports little or no trust in government, while younger cohorts show systematically weaker institutional trust. (UN Social Portal⁠)

This is where housing, fertility, work and politics finally meet.

A young generation that delays independence also delays family formation.

A generation that owns fewer assets has less exposure to the upside of asset inflation.

A generation that expects lower upward mobility may have less confidence in institutions.

And a generation that believes the rules no longer produce the promised result may become much more willing to change the rules.

That is not automatically extremism.

It is arithmetic becoming political.

The most dangerous promise in capitalism

Capitalism never promised equality.

Its more powerful promise was mobility.

You may begin with less.

But effort, work, education, savings and risk-taking can improve your position.

That promise creates legitimacy.

If people conclude instead that asset ownership depends increasingly on inheritance, professional security is fragile and housing requires family wealth, then capitalism risks becoming perceived not as a ladder but as a club.

People outside clubs tend eventually to become interested in changing the membership rules.

Older generations are not the enemy

It would be intellectually cheap to turn this into an attack on Baby Boomers.

Most individuals simply made rational decisions within the economic environment they encountered.

Someone who bought a house in 1985 did not personally design the 2026 housing shortage.

Older generations also face genuine problems: healthcare, loneliness, pensions, care costs and longer retirements.

The issue is structural, not moral.

Intergenerational warfare is another convenient distraction from policy failure.

A society can protect older citizens without making economic independence impossible for younger ones.

That is what functioning public policy is supposed to accomplish.

What would repairing the contract look like?

Not free money.

Not pretending everyone can own a central-city apartment.

Not blaming landlords.

Not blaming immigrants.

Not blaming young people’s consumption.

The answer is less theatrical.

More housing supply where people need housing.

Transport allowing cheaper housing to connect to productive employment.

Higher productivity translating into wages.

Childcare that does not turn the second income into an accounting exercise.

Tax structures that do not excessively reward existing asset ownership over productive work.

Education linked more closely to actual labour-market outcomes.

Pension and healthcare systems designed honestly around ageing populations.

In other words:

the solution is probably boring.

That is usually a good sign in economics.

The generation that followed the instructions

We frequently criticize younger people for delaying adulthood.

But perhaps adulthood did not merely move culturally.

Perhaps its entrance fee increased.

Today’s 30-year-old may be better educated than his parents.

More internationally connected.

More technologically capable.

Possibly earning a higher nominal salary.

And still living in the childhood bedroom.

That is not necessarily evidence of laziness.

It may be the most concise economic chart we have.

The old social contract said:

Study.

Work.

Save.

Be responsible.

Eventually you will build something of your own.

Millions did exactly that.

If the promised result becomes increasingly inaccessible, society should not be surprised when they question the contract.

A system cannot indefinitely demand responsible behaviour while making the traditional rewards of responsibility progressively harder to obtain.

This is not the death of adulthood.

It is adulthood repriced.

And sooner or later, repricing a generation becomes political.

Roberto Balbino
Founder & CEO, Fintech SCB
Independent analyst of finance, economics, geopolitics and global markets
www.fintechscb.com

Principal data sources: Eurostat Demography of Europe 2026; Eurostat housing and youth housing data; OECD Society at a Glance 2024; OECD Employment Outlook 2026; OECD fertility research; United Nations World Social Report 2025; International Labour Organization research on GenAI and work.